No Lift for the Weary

The hatred for drug stocks just keeps on growing, Cramer says.
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The hate affair with the drug stocks knows no bounds. There was a time, not that long ago, when Pharmacia & Upjohn (PNU) would have ramped up today rather than get crushed under the onslaught of sellers.

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As I write this, someone is on TV saying that this is a "great, great sector," and I have to laugh. This sector is simply terminal right now. It is in the process of a massive

S&P

re-evaluation downward.

Remember, to understand the way mutual funds work, they view everything through the sector prism. Right now, they want to overweight the tech portion -- that's the winner -- and bolt from the loser segments, the financials and the

drugs

. The latter all have skulls and crossbones on top of their symbols right now.

It gets worse. Once the mutual funds are done with their poison avoidance, then the SPX gets rebalanced and the index funds jump on the tech and off the drug bandwagon.

Those of you who traded through the great unwind of the oil and oil-service stocks in the mid-'80s -- they were at one time a giant portion of the S&P -- know what I am talking about. Only this time it is more severe because there is much more money indexed than ever before.

In short, no lift for the weary. And continued good fortune for the blessed.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of the original publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.