Transcript
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Jim Cramer (1:03)
My mission is simple to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. My friends, I'm just trying to make your own money. My job is not just to entertain, but to teach you. So call me at 1-800-7-3 CNBC tweet me Jim Cramer Sometimes you get used to certain stocks being winners for so long that you aren't even aware when their triumphant status possibly runs its course. And that's how I am feeling right now. About still one more day here with tech wilting on the vine. Dow losing 155 points. SB slipping point 3.3percent NASDAQ decline point by 3% like most market participants, I am unwilling to say goodbye to Tech Tech. It's been such a long term winner that I'm reluctant to forsake it and please, I mean, look, I just did come back from Nvidia's GTC conference last week. Things were going great. I can't just say, well, that's over eight days later. But when I scroll through the winning sectors for the year, I am struck by how they represent a wide array of groupings that aren't tethered to any particular economic worldview. Neither recession viewpoint nor a severe slowdown can explain which groups are pulling away from tech and communication services, the sub rubric that includes many Internet companies. The leaders for the year indeed are very strange counter to it or you just call them broad if you wanted to. Let's start with the number one performing group and this is a true oddity. Let's talk about the energy sector. Now we know the President's keeping committed to lowering the price of oil in this country. Something was actually referred to by Vice President Vance in that bizarre signal thread that accidentally included Jeffrey Goldberg, a harsh Trump critic and the editor of the Atlantic. The exchange, which has proven to be true, has Vance wanting everyone on the chain to know that it would be most unfortunate if an attack on Yemen causes the price of oil to jump. Yet here it is, number one, top of the heap and I would be a little subject here and dip to the third best performer in the oil and gas space because the top two really aren't that representative. And the third is Chevron, among my favorite, which is up 15% to start this year after some some billion kind of longer period of underperformance. And some of that success is because of the company's hefty dividend that yields north of 4%. Underneath Chevron on the list are a host of natural gas companies which are big winners in the liquefied natural gas LNG export market. I think the group's also being helped by strong demand for natural gas power from the nation's myriad data centers that could only just get better. Now I thought this group would be down given that the President wants to expand drilling and we have a slower economy. But the stocks aren't expensive and demand for natural gas very strong. Coming in second is health care and I think that's representative of the view that tariffs and prospective tariffs might cause a recession. And by the way, health care has gotten much more away from drugs. Service, service can't get tariffs. These are textbook slowdown stocks though there's a nice true at work at the top of the health care sector. First is cvs. That's longer laggards come back with new management as well as a resurgent Aetna health insurance business. Vertex Pharma comes in second owned. He give you that enough because they got this terrific new opioid non habit forming painkiller. And then third there's Sancor, a classic drug middleman, part of a subgroup that always seemed to send someone out at the top to prove that the theme isn't just recession. Financials are the third best performing sector and we know this group has a hefty reliance on credit which sours in a recession. Insurance has been incredibly hot this year with a remarkable pricing factor. As you know we if. Well, you know all too well if you own the stocks of Brown and Brown or Arthur J. Gallagher, two stored insurance brokers that top the list of best performers in the group. I never met anybody who owns them though. The third finance name, Intercontinental Exchange ICE owns this, the New York Stock Exchange as well as a host of commodity exchanges. I really like that stock. None of these have any real credit risks, but I like them. But their financials nonetheless and the bank stocks are actually are acting much better than expected even if they're not at the top of the heap. Now the consumer staples long considered safety stocks, well let's just say they, they aren't all that safe these days because of a host of challenges, everything from GOP Dash 1 drugs weighing down the food business to higher prices for all sorts of commodity inputs. But there's a frequent winner here. Among the consumer staples is one I won't recommend because it's got tobacco in and that's Philip Morse, the International Tobacco Company. It's one of the greatest stocks of all time though Walgreens has made a comeback too. But it's going private. Consider that one done do not want to own that, do not want to buy it. Whatever. Dollar General is number three and it's stock that historically has done well on a slowdown. Two food and beverage companies managed to make the cut, triumphing over the GOP Dutch one anti craving drugs perennial favorite Coca Cola and Modelese. Nice broad grouping there from the recession resistant the recession suspect we go to materials on top is new at mining because gold's had an amazing run. Is that fear now? I don't know a matter of fact it territories maybe I don't precious metal being a good storehole of value. Hey, you know what? Maybe given out goals, astronomical outperformance bit of all three. Steel Dynamics comes in second within the materials group and I think that's a winner in the tariff force. Third is fertilizer company Mosaic. Now it says something when the most complex tech instruments ever are all out of style. This year, while people bet on the most simple formulas, the most commodity of commodities can't think of anything less glamorous or easier to make than fertilizer. When interest rates go down, we normally go for utilities, but rates are going higher here. Now it could heretofore mean that people want to profit from a slowdown if not a recession by buying companies with consistent earnings. So if they're Buying Consolidated Edison, which is kind of a purveyor of electricity for the New York metro area, as well as number two, Exxon. The name of the utility encompasses Baltimore Gas and Electric. Pico, that is the old Philly Lack and comment. That's the old Commonwealth, that Chicago utility. Well, what can I say? As plain as it gets, the REITs rule in real estate. That's the seventh best performing group, the real estate group. And we have three very different ones showing the broad nature of this rally. In this part, the subset versus Welltower, that's a health care infrastructure company. Then American Tower, which is the REIT that owns cell towers. Then there's Ventas REIT dedicated to senior liberal. You said them on all the time. Talk about, talk about broadening of the market. I mean, call this a paragon of diversity here. Finally, there are the industrials, again, a group that's prone to failure during a recession. See my point? These are all oddities, right? The Industrials are led by Uber Technologies, which is a much, much more of a services company that's somehow classified the group. Then it's followed by Airspace and Helmet, which makes fast turns for planes. These are both part of the aerospace bull market, which is still going on. It's a quiet one that shows no sign of quitting at all. More on that one later. These new winning sectors haven't seen the light at the top of many, many quarters because, well, I mean, for ages it's been tech tight tech. For years people have talked about how they would hope that the rally could finally broaden out beyond tech. And now that's exactly what's happening. Except you can't call it a rally anymore. Now the broadening has arrived, investors seem to pine for the stocks of Europe, mainly the Magnificent Seven, which are split between the communication services sector and the information technology sector. But they share one thing in common. They're almost all bad. We can't be too duplicitous here. A day like today signals a healthy market, even in the face of what we're endlessly told is a troubled market. Intriguing, right? Ironic, maybe. I don't know. Now none dare call this a bull market. The seven stocks that made up, make up the once magnificent Seven are too big to dismiss. You need at least some of them to put together really positive tape. But the bottom line, it's to see such a broad mixture of stocks winning here, from ones that can run in a recession to ones that can rally hard in a robust economy. What it tells me is that the market may be Far heavy, healthier than we think. And this backdrop simply isn't as bad as many would have you believe. Let's go to Frank in New York, please. Frank.