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NEW YORK (
TheStreet) -- Investors should avoid hot stocks like
Cliffs Natural Resources(CLF - Get Report), Jim Cramer advised during his
Stop Trading! segment on CNBC.
Shares of the miner are surging 7.5% to $58.70 in afternoon trading, as the market reacts to an Australian tax that may or may not be passed. Australia is looking to impose a 40% tax on profits made from mining projects.
But Cliffs took a big dip on Tuesday, losing 5.7%, as news spread that Australia government was readying itself to pass the tax.
"What I don't like about this market, and it wasn't this way even two weeks ago, is you can be so wrong and at the same time be so right," Cramer said.
He recommends investors stay away from such swinging stocks, which are becoming increasingly harder to trade, and instead look to more stable names like
General Mills(GIS - Get Report) and
Johnson & Johnson(JNJ - Get Report).
Cramer's other trade of the day is
Starwood Hotels & Resorts(HOT - Get Report), which is taking a beating in afternoon trading. Last week the company reported significantly higher first-quarter profits, which Cramer said should have calmed fears of those who worry about the travel market.
"It's not that bad," he said.
--Reported by Jeanine Poggi in New York.
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