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The markets haven't found their footing yet, Jim Cramer reluctantly told his Mad Money viewers Monday, after another very weak day on Wall Street. That means selling into any strength and continuing to nibble at the cheapest of stocks as they head still lower.
Cramer returned to his "Market Bottom Checklist," which he debuted in January, to see if investors have anything positive to look forward to. He said the Federal Reserve remains in a pickle because employment remains strong, but there are no other signs our economy is overheating. More clarity from the Fed will be needed to check off this market worry.
As for the political uncertainty, there's still no clarity on who the candidates will be or what their agendas might hold for the markets. There's also no resolution in the Chinese markets, but renewed tensions with North Korea after a missile test over the weekend.
Commodities and oil both continue to try to find a bottom, Cramer said, but aren't there yet. Likewise with the mergers and IPO markets, which have all but disappeared.
The U.S. dollar was the only bright spot on Cramer's list, as its strength is weakening, at least against the euro.
Finally, Cramer added a new box to the list, credit issues, which seem to be mounting for some European banks, added to existing fears of another credit crunch.
Cramer on LinkedIn
What should investors make of the carnage in LinkedIn (LNKD) and Tableau Software (DATA) , which plunged 44% and 49%, respectively, on Friday? Cramer donned his crime scene investigation gear to determine the true cause of death.
Cramer said that LinkedIn was once a high-flying growth stock, beloved for its mobile, social and cloud aspects. But that all ended Friday when the company reported in-line earnings but slashed its guidance citing global economic concerns. That lead to the stock losing $11 billion of market cap in the blink of an eye.
The cause of death? Everyone assumed that LinkedIn was a secular grower and immune to global worries. Turns out it's not, and that means many investors need to reevaluate. Cramer said this stock cannot be touched until the company's credibility is restored, which will take at least another three months.
As for Tableau, this data analytics company was eerily similar, delivering OK earnings with weak guidance. That lead to shares getting cut in half on Friday and losing another 10% today. Tableau cited increased competition and customers becoming more cautious, two things you don't want to hear from a growth stock.
Cramer said the problem with Tableau is that even down here, the stock still trades at 53 times earnings, just below Salesforce.com (CRM) at 55 times earnings. Salesforce is growing like a weed. Tableau stock, Cramer concluded, cannot be touched.
Cramer Stock Picks
Is this a difficult stock market? You bet. But there are high-quality stocks worth buying on the way down, Cramer told viewers. He recapped the most exciting stories he heard last week in San Francisco.
Verizon (VZ) tops Cramer's opportunity list because as this company offers both capital preservation with its dividend and capital appreciation with its many growth opportunities. Let's not forget the possible acquisition of properties from Yahoo! (YHOO) .
Next on Cramer's list is Yum! Brands (YUM) , which offers investors growth and the upcoming spinoff of its Chinese assets. Yum is followed by Clorox (CLX) , another steady growth name with a solid dividend and excellent track record of innovation.
Finally, Cramer highlighted Ford (F) , which continues to post solid results, and Wells Fargo (WFC) , which he recommended buying when it hits a 3.5% yield. Wells Fargo and PayPal are Action Alerts PLUS holdings.
Stocks the Market Ignores
There's no mistaking that the high-growth stocks are in bear market mode, Cramer told viewers, but that doesn't mean the companies behind these stocks aren't delivering for shareholders.
Then there was Palo Alto Networks (PANW) , which remains the best cyber security story out there, and Fitbit (FIT) , the best health and wellness story out there. Cramer said both of these are great companies but they, too, are out of favor on Wall Street.
Investors have lost faith in the future for all of these stocks, Cramer concluded, but when the markets calm down they will likely be among the first to which investors turn.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer told viewers not to underestimate how important Fed Chair Janet Yellen will be to the market when she speaks on Wednesday. If Yellen signals the Fed is returning to a "data-dependent" stance on rates, investors need to be prepared to catch that rally.
Cramer said the Fed appears to be fixated on the unemployment rate and on wage growth, and seemingly nothing else. While the Fed shouldn't be focused solely on the stock market either, he said the markets, and commodities, as well as the overseas markets, are all signaling that trouble could be ahead.
The market's can't fight the Fed along with everything else it's facing, Cramer concluded. But if Yellen indicates a pause in rate hikes, that will be more than enough to get at least a short-term bounce in stocks.
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