Even on a down day, there's still compelling action in individual stocks, Jim Cramer announced to his Mad Money viewers Thursday. The reason? Cramer called it "FOMO" -- the fear of missing out.
Exhibit "A" was UnitedHealth Group (UNH) , which reported stellar earnings that everyone expected and was met with three straight days of new highs. Cramer said there simply isn't enough liquidity to meet all of the buyers' demand and sellers are few and far between. For money managers looking to make big block trades, that means prices have to rise.
The same applies to ASML Holdings (ASML) , which has risen 13.9% over the past week as buyers are willing to pay just about any price for fear of missing the move.
Shares of Boeing (BA) , Walmart (WMT) and countless other individual stocks are all exhibiting the same pattern. In the case of Walmart, the company announced it will increase its already sizable share buyback program, in addition to giving its workers a pay raise.
This shortage of stock is real, Cramer concluded, and the more stocks rise, the less likely shareholders will be to sell.
Executive Decision: IBM
For his "Executive Decision" segment, Cramer sat down with Martin Schroeter, senior vice president of global markets at IBM (IBM) , which just reported a 4% rise in revenue -- its best in six years -- but saw its shares fall 3.7%.
Schroeter explained that IBM has real momentum going into 2018, with growing revenues and stable margins. Earnings per share, he said, still has some headwinds, but overall, the secular trends driving their business, including the cloud, security, mobile and analytics, remain strong.
Many people think mainframes are dead, Schroeter said, but in fact, they are very much alive and today's mainframes are faster and more secure than ever before.
IBM also remains a leader in blockchain technology, the same technology that powers cryptocurrencies like bitcoin. Schroeter said that IBM is building a global trade network using blockchain that will cater to the enterprise clients that IBM knows best.
Finally, Schroeter noted that IBM remains committed to its shareholders and will continue to raise their dividend and reduce their share count through buybacks.
Cramer and the AAP team are taking a closer look at news of trade negotiations, and are adding to their portfolio position in Constellation Brands (STZ) . Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts PLUS.
Executive Decision: PPG Industries
In his second "Executive Decision" segment, Cramer also checked in with Michael McGarry, chairman and CEO of PPG Industries (PPG) , which just reported a penny-a-share earnings beat with an 8% rise in revenues. Shares of PPG were up 23% in 2016 but have been essentially flat this year.
McGarry said that technology is driving their business forward and PPG has new products for industrial, packaging and aerospace coatings. PPG is also a global growth story, with only 43% of sales stemming from the U.S., while the remaining 57% come from 140 countries around the world.
Many people think of PPG simply as a paint maker, but his company also has exposure to electric and autonomous vehicles. The company has coatings to help protect batteries and is also developing new materials to help cars be seen better by the radar and lidar systems used by autonomous systems. PPG even has coatings to help hide the many technologies used by self-driving vehicles.
Sorting Through Mixed Messages
The market is sending a lot of mixed messages these days, but fortunately, Cramer is able to cut through the hyperbole and make sense of it all.
When it comes to the banks, for months we've been hearing that a flat yield curve was a big problem. But now that long-term rates are beginning to rise, we're hearing that rising rates are a problem. The reality, Cramer said, is that banks make more money when short-term and long-term rates are on the move, and that news comes from the banks themselves.
Then there's President Trump. It's no secret that Trump isn't overly popular, but you need to check your emotions at the door, Cramer said, and admit that deregulation and tax cuts are good for the economy.
Next, we need to talk about bitcoin. With all of the excitement over cryptocurrencies, stocks have been largely ignored. But when bitcoin finally does flatten out or begin to fall, that speculative money will need to go somewhere and it's likely to move into stocks.
Finally, Cramer reiterated that there's a shortage of things to buy on Wall Street, thanks in part to a slump in new IPOs. That will only continue to put a cushion under existing stocks and send prices higher.
Am I Diversified?
In the "Am I Diversified" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.
Cramer said this portfolio was perfectly diversified.
This portfolio was also diversified in Cramer's book.
Cramer also blessed this portfolio as properly diversified, as well as being a terrific group of companies.
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