CNBC’s Jim Cramer said the Department of Labor’s job report satisfies markets Friday, at least temporarily.
The U.S. economy added 379,000 jobs last month and the unemployment rate fell, with stocks bouncing from their daily lows and making a tough three-day trade stretch to end the week.
Economists had predicted that the labor market would grow 210,000 in February.
“A strong, but not too strong, employment figure was what this crazy market needed today, even though it took half a day on Wall Street to find out,” Cramer said after the closing of “Mad Money “.
All major stock indices rose nearly 2% further at the close after trading in the red during the morning. The Dow Jones Industrial Average added 572 points, 1.85%, to close at 31,496.30 and finished 1.82% after a volatile week. The S&P 500 advanced 1.95% on Friday to 3,841.94, also ending the week in positive territory.
After closing the red Thursday, the Nasdaq Composite bounced 1.55% to 12,920.15 on Friday. The heavy technology index ended the week with a 2.06% decline as growth shares were sold.
As the U.S. continues to recover from last year’s coronavirus-induced restrictions and business restrictions, the February labor report probably didn’t do enough to push the Federal Reserve to raise interest rates to curb inflation as the economy grows, Cramer said.
“It was a hidden Goldilocks report: a lot more people are being hired thanks to the vaccine launch and reopening, but not so many that the Fed is being forced to raise interest rates, and some are lagging behind.” He said.
Wall Street is waiting to see if the uptrend will continue or the uptrend of stocks will resume. However, the bond market is still in control, as investors continue to move from high-growth stocks to cyclical valuations and names until Treasury yields stabilize, Cramer added.
Long-term treasures are a deciding factor in loan rates. Higher rates make cyclical stocks more attractive, which causes investors to reduce their appetite for riskier assets.
“I’m betting that bondholders will be back, so get ready using rallies like this to lighten them up, as we did for my charitable confidence at the end of the day, and you’ll certainly lighten the actions of high-flying dreamers and the SPACs, ”he said. “That way, you’ll have some money to deploy for real companies next time they hammer us like we did yesterday afternoon.”
Cramer gave his game plan for next week. Earnings per share projections are based on FactSet estimates:
Monday: Fixing stitches
- 2Q 2021 earnings release: after market; conference call: 5 pm
- Expected losses per share: 22 cents
- Expected Revenue: $ 512 million
“A big quarter won’t produce the kind of explosive reaction we had last time,” Cramer said. “Still, I’m betting the numbers are better than expected, as it’s a big deal.”
Tuesday: Dick’s sporting goods
- Launch of profits for the fourth quarter of 2020: before the market; conference call: 10 h
- Expected EPS: $ 2.30
- Expected Revenue: $ 3.07 million
“I hope Dick provides a very strong number, that he can blow up the shares,” he said.
Wednesday: Campbell Soup, Oracle
- 2Q 2021 earnings release: before the market; conference call: 8:00 am
- Expected EPS: 83 cents
- Expected Revenue: $ 2.3 billion
“So far, those pantry stocks haven’t been able to impress,” Cramer said. “I can’t go against the wisdom prevailing here, although I think this company has won enough snack deals that won’t disappoint you, and you’ll get that 3.2% return.”
Oracle
- Launch of profits in the third quarter of 2021: after the market; conference call: 5 pm
- Expected EPS: $ 1.11
- Expected Revenue: $ 10.05 million
“This is exactly the kind of lower-risk technology stocks that people suddenly like … [as opposed to] the high-flying ones, “he said.” These still break into pieces, so I was willing to recommend Oracle [tonight], but I got punched. A big brokerage house pushed it today, it sent the shares 6%, it stole my thunder. “
Thursday: JD.com, Ulta Beauty
- Fourth quarter earnings release: before the market; conference call: 7 h
Cramer said JD.com is “one of the few Chinese stocks I like because it’s something else from the Chinese Amazon.” It’s like Alibaba, which you already know I like, but has faster growth.
Ulta Beauty
- Fourth Quarter Profit Launch: After Market; conference call: 5 pm
- Expected EPS: $ 2.32
- Expected Revenue: $ 2.27 billion
“It’s about to experience a sales explosion when the country reopens. Ulta pivoted on e-commerce when the pandemic hit … but now that we’re vaccinated, its brick-and-mortar business can come back to life “, he said. “In addition, they will launch a new Target collection. It would be a buyer before this quarter.”
Disclosure: Cramer’s charity has shares in Amazon.
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