On Wednesday there were "rather radical" changes in the S&P 500 that might have caused the market's afternoon volatility and sparked a bounce at the end of the day, Jim Cramer said on TheStreet.com TV's Wall Street Confidential video Thursday.

As BellSouth was bought out, a lot of money had to come out of the S&P 500 very quickly, which may have caused some futures selling, he told Aaron Task, the host of Wall Street Confidential. But now that the BellSouth deal has been completed, the positive could be that the technicals of the market will reverse and the money will flow right back though, Cramer said.

Further, the comeback at the end of the day Wednesday and the "incredible lift in futures" was not because of buying, but rather may have been related to the end of futures selling, he said.

However, Cramer considered Wednesday's market action "bad" because he was disappointed to see the companies he considers less consumer-sensitive to be the only ones left standing. Instead he said he would have loved to see the Caterpillars ( CAT) be left standing and see Phelps Dodge ( PD) higher.

"None of the offensive stocks or the manufacturing stocks did well and I don't want to see that," Cramer said. "I want to see that the earnings decline in housing and the earnings decline in retail can be contained so that other areas don't get hurt."

Moving on, Task commented that the retail sales number, which was released this morning, showed that the specialty retailers had a bad Christmas, to which Cramer responded by saying "there is a secular change in retail" currently going on, where the high-end is "booming."

The "aspirational retailers," whether it be Guess? ( GES) or Costco ( COST) is where the action is, he said.

However, because the retail results were "mixed," Cramer said he doesn't want to put too much emphasis on them. "There is no monolith to retail -- there is some good and some bad."

Cramer said he believes Home Depot ( HD) is going to be one of better performers in the Dow Jones this year. But at the same time "the stock can't sustain a 2-point gain until the numbers turn," he said.

Although he likes Home Depot because housing is bottoming, Cramer said he likes Lowe's ( LOW) better.

In a "Lightning Round" session, Cramer called Wal-Mart ( WMT) "awful."

He said he believes Alcoa ( AA) will get a buyout and Altria ( MO), which he owns for his charitable trust, Action Alerts PLUS, will split up.

"People don't understand that because Altria has held back its buyback, it has a tremendous amount of cash," Cramer said. "It's at its 52-week high without a buyback -- it could be really big with it."

Regarding AIG ( AIG), which Cramer also owns for his charitable trust, he said the stock's future depends on when Hank Greenberg, the company's biggest shareholder, stops selling his shares.

When Task asked about Caterpillar, Cramer said the stock should go down and then up. "It is a May play," he said. "It peaked in May of last year and should bottom in May of this year."

Moving on, Cramer called Honeywell ( HON) "undervalued" and IBM ( IBM) "cheap" and a low-multiple tech stock.

He also called Johnson & Johnson ( JNJ), which he owns for his charitable trust, the "king of marketing" and predicted it would take Pfizer's ( PFE) products and "take off with them."

Cramer said McDonald's ( MCD) is an great, inexpensive weak-dollar play, which he hasn't bought himself because of restrictions.

Finally, he said Microsoft ( MSFT) is a stock that should go up over time because its Vista product is "huge."

Moreover, as stores start marketing PCs, apart from Microsoft, Hewlett-Packard ( HPQ), which he owns for his charitable trust, should also be a beneficiary, Cramer said.

At the time of publication, Cramer was long Altria, Johnson & Johnson, and Hewlett-Packard.

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. Listen to Cramer's RealMoney Radio show on your computer; just click here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click here to order Cramer's latest 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.

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