Jim Cramer talks the recent dip in the market

My mission is simple. To make you money. I’m here to level the playing field for all investors. There’s always a home 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. I’ll be with my friends. I’m just trying to save a little money. My job is not just to entertain, but to explain this stuff. So call me at one 807, four, three. CNBC. Tweet me at you Kramer. Well, yes, stop it already with the morning buying. That is what I’ve been screaming lately right in the camera when I’m on commercial break for the morning show more. Consider these stats where morning buyers have been getting steamrolled, including today where the Dow opened up 94 points and only finished up just 22, and the SP decline .22% after opening up 9 points and the NASDAQ lost .52% yesterday. Just looking at the S&P, we opened at 5068 up 17.56 points or .35% and then closed at 502 two. The day before that one, we opened at 506 four, up 2.77 or .5% and we closed at 5:05. One Monday we open at 5149 and close all the way down at five O 6. One last Friday we actually opened down more than 27 points at 5175, but we still finished the day even lower at 5123. Yeah. Why do people keep making the same dorm mistake? I think there’s a widespread belief that you can still buy the dip. That’s been the right move ever since the long term interest rates peak back in October. It’s worked before, so they think it’s going to work again. Well, that’s really good thinking. Now though, buyer buying the dip is the quintessential wrong thing to do. It is just off the tracks. And I’m going to tell you what first. Bonds are charged in charge right now, not stocks. Bonds are charged and once again, the long term interest rates are going higher like they did today, like they’ve been doing throughout this whole recent decline. Sure, there’s been a flight to quality on some days, but we know that didn’t count. Ever since we started getting hot inflation numbers, the bond market’s been doing the work of the Fed. Yet traders, investors just can’t seem to resist because bit buying had been working, but it was only right when rates were going lower. It’s wrong when rates are going higher because you are fighting the tape. Second, we don’t have enough of what I’ve started calling brown shoots. That’s my name for signs of a slowdown. Just like green shoots are signs of an acceleration, brown shoots can come from companies with disappointing earnings later on the show. I’m going to walk you through the sudden downturn of Prologis, A gigantic real estate investment trust that’s the global leader in logistics facilities and JB Hunt, one of the nations largest trucking companies. Brown shoots abound. I could include two auto related names. CarMax, the used car dealer which blew up when it reported, and Snap On Tools, the reliable specialty tool company that sells the individual auto repair shops that lost an astounding 7.6% of its value on a rare earnings miss. But we don’t have a lot of blow UPS in the morning, so buyers figure out if the coast is clear. On most days it isn’t. There’s no Coast is clear a call because we aren’t trading on earnings right now. We’re trading on fear, and fear does not lead to great closes. Third, not all stocks are created equal. We have what we used to call leaders and the leaders. They are failing us. The biggest failure? Tesla, which is going down relentlessly in a totally scary pattern. How much will Tesla lose this quarter? That’s a common refrain. How about that pivot to going into robotaxi? Well, Hertz tried that going big with Tesla’s and that failed. Why would that be any better for Tesla itself? The country’s just not ready for self driving cars. Instead, Americans want solid, inexpensive electric vehicles, not expensive ones. Those are done. And they sure don’t want Tesla’s cyber truck. I thought Elon Musk’s fanboys would buy it, but the darn thing has what I call no mojo. Maybe because it needs to be advertised. I don’t know. I mean, perhaps Tesla needs to run a traditional pickup truck ad where some gravelly voice guy talks about ditching the Form F-150 because the cyber truck has bulletproof windows. I can’t think of any other seller point. Best I can do. Next jury leader is Apple. Now, I’ve said you should own it, not trade it. I’m not going away from that. But if I had to buy it, I’d right, Right. Either wait so the stock pulls back to 160, or at least wait until the company reports and then it cuts its forecast. What you need to know is that stocks have not been bottoming on estimate cuts in this market. They fall and then they fall again. Can Apple pull a rabbit out of a hat? Sure, anyone can. Elon Musk can too. But I don’t see magic happening yet with Apple. It’s dreariness is so powerful that it weighs on us every day. See, it cuts, forecast goes down and maybe next day goes down. Let’s get some downgrades and then it bottoms. That would be the pattern. Final devastating leader is my pal NVIDIA, which has the stock. They can’t find its footing even as it manages small game today. This is a very discerning market and the rally in NVIDIA into its phenomenal GTC conference has been more than wiped out. Now this is not a new pattern that it tends to rally and then drift and go go along and then we get the quarter and it rallies again. Rinse and repeat. The difference. This time your enemy, your fellow shareholders who either don’t know what NVIDIA does or is or now believe the generative AI is a scam. The stock won’t be safe until all these weekends get washed out. Unfortunately, so many of these fellow travelers bought NVIDIA at the wrong time. They didn’t experience the run, they came in late, and they have a real bad cost basis. It’s a terrible entry point. These are the people who cannot take the House of pain. A House of pain. They know nothing. Maybe market leader Netflix can break the scan of wounded leaders flailing in. The market has reported a good number this evening. But what has become a typical of the accentuate the negative pattern. The company’s boilerplate warning about the future maybe just being OK. Maybe that’s transcending all the good news. Who knows? 4th we aren’t getting any good aggregate data and people don’t seem to care. Well that’s wrong. They buy anyway. That’s wrong. Why don’t they realize that the data is in control? The CPI, the price, the plate or the non farm payroll report? Because the data determine the interest rates and interest rates determine the stock market action. Right now you cannot ignore the data anymore. You need some really weak economic market data to make the market go higher because Wall Street’s desperate. First slow down that we give the Fed an excuse to cut rates. It needs an excuse. It doesn’t have 1/5. We keep ignoring the Middle East and then when we get to Friday, we get scared to death and something will happen over the weekend and people dump everything. There’s always something to worry about in this conflict, so the pattern keeps repeating itself. Now what would happen if people stopped by in the morning and instead sold big from the get go? That, friends, is what I’ve been waiting for. You’re not going to get a bottom, a serious bottom, a lasting bottom until you have the big give up, the gigantic end of days to climb where people just can’t handle the House of pain at all. No way. They want a new address. They want the 5% CD address. The stock market address is just too horrendous. Don’t buy, don’t buy. When you get the vicious open, the down 1 or 2% abyss staring you right in the face, then the market has a chance to wrestle. Turf Farmer. You need to have that, what I call whoosh, where we just crater at the opening. Abomination includes lots of formerly bullish, now scaredy cat owners who don’t want out, who they just went out so badly they don’t even care what price they get. Not only that, but the down opening doesn’t mean a bottom for that day. For that you need to have a true crescendo to follow the whoosh, whoosh, then crescendo. Typically that means you see a rally at the open, a whoosh down, and then machine Gunners come in at those brave souls who try to buy the market, like the first day of the song. Then you get what I call the crescendo, just like in the music, where there’s a colossal blowout that leaves people aghast and you get a chance the next day. The next day you see the local news trucks with those weird antennae on the roofs that will have well clothed men or women with a mic in their hand hanging around wall and broad streets staring into a camera trying to grab some bystander. We’ll talk to them about jumping off a building or something. You know, I used to go up to those people and when they would ask me what I thought, I would say, hey, you know what? I think, ’cause you’re down here, it means the markets bother me. Well, of course my interviews never aired. Bottom line, when you get the news that that the trucks and the journalists asking people how they feel about losing fortunes in the stock market, that made Mark the real bottom. Unfortunately, there’s been no whoosh, no crescendo and no local TV. People with mics and their funny trucks. Until then, presume we have not yet bottomed. Hey, how about Matt in New Jersey? Matt. Hey, Booyah, Jim, not bad. I was in Philadelphia today. Good time. How about you? Very good, very good. The stock, the stock I am calling you about today is the American Airlines. Your earnings are coming out next Thursday and I would like to know if you think I should add to my position now before they post the earnings or wait. And in your opinion is American Airlines a buy, sell or hold? OK, so let’s, you know we’ve got Delta pretty good numbers and we have without a doubt United reporting great numbers. Will American continue that? I would tell you that American 14 is back to where it was. I mean so, so long ago. You know what? I don’t want to play airline roulette, but I do believe that 14 bucks. I don’t know. One Down to up. Hey, how about we go clear across the country to Jeff in California? Jeff. Hey, Jim, I’m in LA. I’ll get right to the point. I bought $8000 worth of square or block three years ago. It’s up 16% in one year. Bam. And in three years it’s down 71.3%. Ouch. So I -? 6000 dollars in three years. Jim, I have very little patience. I told my son David, I’m not a doctor. I have no patience. Should I continue praying, Jim? I’m very spiritual or should I sell now Bam, OK let’s think about this. I happen to think the company it can go higher. I like the last quarter. I know it’s painful. I know that you don’t have any patience. But can I ask for you to have fortitude? Because that’s what it’ll take right once we get the new trucks and the funny trucks and the things that about and the journalists asked us how we feel about losing fortune stock market that smells like a bottom but unfortunately we haven’t seen that yet. Oh man. If there’s one thing you can count on during earnings season, it’s that Wall Street will get some of them wrong. Tonight I’m eyeing A charitable trusting Abbott Labs one of the best companies in the business. Tell you why the market may have discharged this one all the way down that are the package good stocks, the whole package. I’m taking a closer look at the comeback we’re seeing in that space and forget green shoots. You know what? I’m I, and I’m I in the brown shoots that are being revealed by two major operators this earning season and telling you what it means for the overall market. So stay with Kramer. Don’t miss a second of Mad Money Follow at Jim Cramer on X. Have a question? Tweet Kramer hashtag Mad Mentions Send Jim an e-mail to [email protected] or give us a call at one 807 Four Three. CNBC. Miss something? Head to madmoney.cnbc.com.