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"All of the wrong stocks went up today," a concerned Jim Cramer told the viewers of his "Mad Money" TV show Tuesday.
He said it can be a very bad thing for some stocks to go higher.
Cramer said the market has been lifted by three rockets: oil, technology and banks. The fuel for these rockets, he said, has been money coming out of other sectors such as food and drug stocks.
That's why Cramer was alarmed to see strength in names like
, along with
, two stocks Cramer owns for his charitable trust,
Action Alerts PLUS.
Cramer also noted the strength in other stocks that should be headed lower, including
, along with drug makers
Johnson & Johnson
"Stocks like Kraft and Molson need to keep going lower," said Cramer, if this rally in oil, tech and banking is to continue. They're the fuel for our rocket ships, he said, and they need to be watched closely.
Off the Charts
In this segment, Cramer dove into the chart of
to see if this stock's recent upside move is over or a harbinger of good things to come.
Cramer said when looking at the daily chart of Cleveland Cliffs, it may look like the move is over. But if you look at the stock's weekly chart, you'll see another side. He said the stock has barely moved in the weekly chart, and the volume signals the slow accumulation of buying pressure.
Turning to the fundamentals, Cramer said there are three reasons to like Cleveland Cliffs. First, the stock has been hammered by mutual funds, with 19 funds selling 100% of their positions recently.
Second, this once $120 stock now trades at $27 while holding all of the same assets in an improving commodity market. And finally, Cramer said colleague Rick Bensignor just upgraded rival
, which bodes well for Cleveland Cliffs.
Cramer said simply, "Cleveland Cliffs is a buy."
Emeril's Take on the Food Business
In a special interview, Cramer welcomed superstar chef and restaurateur Emeril Legasse to the show to discuss how the food business mirrors the economy.
Legasse said that the mood is beginning to lighten for fine dining, and people are beginning to eat out again. He said that while his pasta, seasoning and cookware businesses have been on fire as people were eating more at home, his restaurant traffic is now getting better week by week.
Legasse said he's also made changes at his restaurants to adjust to the changing times. He introduced a "wines-for-the-times" list of cheaper wine alternatives and is offering more smaller plate items at more affordable prices.
Legasse was also very optimistic about "Emeril's Chop House," a new restaurant in Bethlehem, Pa. that will be part of a new
Las Vegas Sands
casino at the site of the now defunct Bethlehem Steel Mill.
Legasse was also excited about his new book,
Emeril at the Grill,
which debuts in time for the summer grilling season.
Cramer said Legasse's food empire, which spans restaurants, packaged food and media, is the perfect microcosm for the economy, and shows there are bright spots if you know where to look.
Poised for a Turnaround
In the second part of his "Tech Spec" series, Cramer recommended
, a once bellwether turned has-been that might be poised for a turnaround.
Cramer said on the surface, this $5 speculative name may appear a longshot, with its bad balance sheet and $2.1 billion in debt from its recent acquisitions. But speculative stocks usually don't offer perfection and Brocade has a few things going in its favor.
First, Cramer noted the company's expanded agreement with
, allowing Brocade to begin manufacturing more types of network equipment under the IBM nameplate. But more importantly, the recession has helped Brocade by giving it time to catch rival
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS, he said.
According to Cramer, Brocade doesn't need to beat Cisco, just take some market share, in order to prosper. He recommended waiting for Cisco to report its earnings Wednesday before a little of the speculative Brocade.
Cramer was bullish on
Bank of America
Nordic American Tanker
He was bearish on
Lions Gate Entertainment
Health Management Assoc
Hot Topic Inc
American Eagle Outfitters
Check out the latest edition of
"Cramer's Take onTop-Headline Stocks" on Stockpickr.
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At the time of publication, Cramer was long General Electric, Pepsi, Chevron, JP Morgan, Cisco.
Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."
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