Jim Cramer's Stop Trading! Buy Charter - TheStreet

Jim Cramer's Stop Trading! Buy Charter

A bond market rally is good for the debt-heavy cable operator, he says.
Author:
Publish date:

Charter

(CHTR) - Get Report

is a buy off Tuesday's market action, which saw stocks tank and bonds rise, Jim Cramer said on

CNBC

's "Stop Trading!" segment.

Cramer said the big worry in the market, which had the Nasdaq down 3% and the Dow Jones Industrial Average off 2%, is the subprime crisis. Lenders have reported increasing defaults and delinquencies, leading to larger worries about the financial sector.

Cramer said the subprime meltdown and this morning's 9% selloff in China point to a "worldwide slowdown" that will eventually force the Federal Reserve to cut interest rates. "This is the pain before the rate cuts," he said.

Cramer said sentiment is likely to remain sharply negative throughout Tuesday and into Wednesday. But he said safe haven stocks, such as high-yielding defensive names including

Procter & Gamble

(PG) - Get Report

,

Altria

(MO) - Get Report

,

Kellogg

(K) - Get Report

and

Coke

(KO) - Get Report

, could start to draw some interest Wednesday.

He said the same is true of

Bank of America

(BAC) - Get Report

, which is 5% below its highs in spite of a huge buyback plan and a strong dividend. Cramer said money is likely to be funneled into companies with buybacks and dividends in coming days.

Cramer said cyclical stocks such as

Caterpillar

(CAT) - Get Report

, having run up sharply in recent weeks, "have a while to go" before they bottom out. But he suggests buying Charter, the debt-heavy St. Louis-based cable operator, into the teeth of the bond market rally, because falling interest rates give the company a chance to refinance and cut its interest costs.

Cramer also likes oil service plays, saying they have a strong long-term outlook.

At the time of publication, Cramer was long Altria and Caterpillar.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. Click

here to order Cramer's latest book, "Mad Money: Watch TV, Get Rich," click

here to order his book, "Real Money: Sane Investing in an Insane World," click

here to get his second book, "You Got Screwed!" and click

here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by

clicking here.

TheStreet.com has a revenue-sharing relationship with Traders' Library under which it receives a portion of the revenue from Traders' Library purchases by customers directed there from TheStreet.com.