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Jim Cramer's 'Mad Money' Recap: So Much for the Selloff

 

 

 

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NEW YORK ( TheStreet) -- What was the point of selling last Friday? That's what Jim Cramer wanted to know on Mad Money Monday after a powerful snapback rally. Cramer said there were plenty of legitimate reasons to sell stocks last week, but much of the weakness should have been viewed as a buying opportunity.

Cramer said he can't blame investors for selling on the threat of another European recession or continued tensions surrounding Ukraine. It's always smart to be prudent. But for many stocks neither of these situations apply.

Read More: 10 Stocks George Soros Is Buying

Many investors still cite the Federal Reserve as a reason to sell, but Cramer dismisses that notion entirely. Inflation is far less than we expected and commodities like food and gasoline continue to weaken. Others are waiting for a "true" pullback of 5% to 7%, Cramer noted, but that pullback may never come.

Investors who sold on Friday missed opportunities like Dollar General (DG) throwing its hat into the ring for Family Dollar (FDO) , a move that sent its shares up 11%.

Other sectors such the airlines are rallying on cheaper fuel prices, while still others, including the tech and Internet names, only appear to have rested before resuming higher. Cramer said he's seeing a bounce in the retail names and he especially likes the oil patch.

For all these reasons, Cramer said he's a buyer of the market on weakness, not a seller.

What is Nordstrom Doing?

What should investors make of the Nordstrom (JWN) conference call, the one that told shareholders the company would be spending $3.9 billion in order to stay competitive? The one that sent shares plummeting, as the new spending initiatives would reduce full-year earnings by 3% to 5%?

Cramer said while there was a lot to like in the Nordstrom earnings results, the spending news is, sadly, a sign of the times because the popularity of online retailers continues to put pressure on offline retailers. The reality is the better the online experience becomes, the less customers will need to visit bricks and mortar stores, and that's where companies like Nordstrom really shine.

Nordstrom retail stores are great, Cramer explained. They're beautiful, well stocked and encourage browsing. The smart, helpful salespeople are sure to make sure you walk out with exactly the items you were looking for, along with a few you probably didn't even know you needed.

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But as retailers like Nordstrom continue to beef up their online efforts, all these key features will become less relevant, Cramer continued -- which is why he no longer applauds companies for investing in their omni-channel efforts and merely sees them as a necessity to stay competitive.

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