CNBC’s Jim Cramer reflected on Tuesday’s market action and suggested that the moves could be good preparation for investors to expect a rate cut.
“Days like today show that a cut is in the works, which is why we saw the rebound in the late afternoon,” he said. “Days like today are good opportunities for a cut, but they’re not enough evidence that it will actually make a difference.”
Cramer said the Fed would need “generalized weakness” to actually cut rates. He acknowledged that commodity prices have been falling over the past few days and that a Labor Department report released Tuesday showed job openings in April fell to the lowest level since February 2021.
But all of this isn’t enough to signal an economic slowdown, Cramer said, adding that Friday’s nonfarm payrolls report will likely be a clearer indicator of the economy, especially from the Fed’s perspective.
Cramer also stressed that market movements cannot be explained in simple terms, even if such a complicated summary is not convincing. Markets are not monolithic, so the reasons for movements are rarely straightforward, he added. Cramer suggested that Tuesday’s declines could not be attributed solely to falling oil prices or falling Treasury yields, noting that some have blamed rising yields and higher oil prices for last week’s declines.
“I know it’s mundane. I know it’s uninspiring. It doesn’t make things simple,” he said. “But things aren’t simple. If you try to make things simple, you make them confusing.”
