The daily battle between the bulls and the bears has been taken to a new level Jim Cramer told the viewers of his "Mad Money" TV show Thursday. He said there is a literal tug of war in the markets, with investors loving stocks as an asset class, while at the same time hating individual stocks. Individual stocks are simply too risky, said Cramer. With most companies having reported what will likely be their last good quarter, Cramer predicted only pain ahead for most stocks. That's why investors are turning to safer alternatives. There's only one way investors can invest in markets while not investing in individual stocks, and that's with the S&P futures, a basket that invests in all of the S&P500 names. This is exactly what large pension and mutual funds are doing, said Cramer. Cramer confirmed that much of Tuesday's rally was caused by a state-run pension fund, which is obligated to invest the monies they receive, investing heavily in the S&P futures. He used US Steel ( X) to illustrate the tug of war in the markets. U.S. Steel, said Cramer, should have gone lower after the company reported its earnings and received downgrades from analysts. Yet the stock held its own, as the futures markets continued buying into U.S. Steel, along with the rest of the S&P index. Cramer called the disconnect between the fundamentals and the futures mind boggling. He predicted the trend would likely continue through the rest of the year, or until investors finally gain confidence in individual names.
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