There are many different forces impacting the stock market, Jim Cramer told his Mad Money viewers Wednesday. Today, all of those forces were at work, as those worried about the Federal Reserve and interest rates battled with those worried about tariffs and trade.
Higher interest rates are, of course, bad news for the stock market. But fortunately, even after today's eighth rate hike in a row, we're still nowhere near the level of interest rates that preceded the financial crisis. We also have a strong economy and a Fed chairman who takes a measured approach and does exactly what he says.
As for trade, Cramer said, we haven't seen any measured impacts of tariffs so far. Although, the president's comments Wednesday at a New York press conference regarding Canada were a little worrisome and were not factored in to the bullish thesis.
But even with these bearish concerns, money managers continue to pile into technology, retail, transports and FANG, as these high-growth names don't have anything to do with interest rates or tariffs.
Cramer said the key to investing in this market is to stay the course and to stay diversified. Don't get caught up in the market's daily -- and sometimes hourly -- gyrations. Just sit tight, he concluded, and stay focused on the long term.
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What's Old Is New Again
When there's nothing new to trade on, money managers circle back to what's been left behind, Cramer told viewers. Wednesday, that meant taking a second look at retail, a group that's been lagging the averages.
A positive research report helped spark the sector, Cramer explained, citing that the mall is not dead, merchant talent matters, brand power rules and product positioning can have a real impact. Those four items helped spur names like TJX Companies (TJX) , up 46% for the year, Burlington Stores (BURL) , up 34%, and Canada Goose (GOOS) , which has more than doubled so far this year.
Then there's Nike (NKE) , which doesn't seem to have been hurt by a controversial ad campaign. With the consumer, and the company, both doing well, this news bodes well for Foot Locker (FL) , Cramer said.
Executive Decision: United Continental Holdings
For his "Executive Decision" segment, Cramer sat down with Oscar Munoz, CEO of United Continental (UAL) , the airline with shares that are up 25% over the past three months, despite rising fuel prices.
Munoz said United's best competitive assets are the company's 91,000 employees and, combined with services that customers want, they are what's driving the company's success. It's not just about their ability to grow however, it's also about balancing earnings, he added. Over capacity is no longer an issue if you manage the business for balance.
Looking forward into next year, Munoz said he's very excited for what his company has planned. There will be almost weekly engagements with customers that will include a number of fun and exciting things that he can't wait to share.
Cramer said that transportation is the beating heart of our economy, and when the airlines are doing well, you know the economy is also doing well.
Over on Real Money, Cramer talks about why CarMax (KMX) and KB Homes (KBH) are doing well. Get more of his insights with a free trial subscription to Real Money.
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