Wall Street has too many sellers and too few buyers, CNBC’s Jim Cramer said after the exchange closed on Thursday.
“We don’t have too many bears, we have too many cops” who “Bad money“said the host.” When most investors are bullish, it means there is no one left to buy. “
The major averages all fell during the trading day as daily coronavirus diagnoses in the US continued to rise. The Dow Jones industry average closed 317 points lower at 29,080.17 for a 1.1% decline. The S&P 500 and Nasdaq Composite also closed around 1% lower to end at 3,537.01 and 11,709.59 respectively.
“Maybe that’s why the averages changed today,” said Cramer.
Cramer has made this possibility dependent on the optimistic outlook of a number of strategists whom he is closely following.
Mike Wilson, a Morgan Stanley strategist, rolled into one Thursday morning performance on “Squawk box“said he believes the bull market will continue to rise even though stocks are going through a” tricky “moment. He suggested the market was exhausted after starting a big run that started before election day last week and Was even stronger on positive news from a Covid-19 vaccine study earlier.
Wilson recommended pursuing a barbell strategy to allow portfolios to both grow and reopen stocks as the country continues to struggle in an uncertain environment in a devastating pandemic.
He’s not alone with a bullish forecast. David Kostin, a Goldman Sachs equity strategist who The day before wrote in a note He sees the broad S&P index expanding 20% by late 2021 as investors trade higher on vaccine optimism and Washington’s divided government.
However, Cramer took a cautious tone about the market, at least in the short term, as he has for the past few days, advising viewers that it is harder to find buyers to pay for stocks when less bearish or less Pessimistic investors have to convert to bull labor.
“When a strategist says everyone is bearish, it’s a listening moment. When two strategists say everyone is bearish, you may get a little suspicious,” the host said. “But when three great strategists say they are all bearish, you have to find out that the consensus is wrong.”