Buying and selling on big decline days should not be emotionally-driven, CNBC “Mad Money” host Jim Cramer said Wednesday.
He discussed the idea of buying stocks that are down but are COVID-19-proof and not affected by the stimulus stalemate in Washington.
What Happened: The significant decline on Wednesday is not a “sell everything” moment, according to Cramer, and one should have the shopping list ready, instead, to buy stocks in five key areas on the market.
“If you’re worried stocks will keep getting hammered, be ready to pounce on some of these Covid-proof bull markets,” Cramer said.
5G is the first theme, according to Cramer, the election impact or the pandemic cannot stop. The former hedge fund manager likes Marvell Technology Group Ltd. (NASDAQ: MRVL), Broadcom Inc (NASDAQ: AVGO), and Qualcomm, Inc. (NASDAQ: QCOM) in this theme.
In the digitization theme, Cramer prefers Microsoft Corporation (NASDAQ: MSFT). Cramer thinks bears are wrong on Microsoft as the growth in almost every earnings line item showed the company’s strength in digitization. He also praised the company’s CFO Amy Hood — who likes to under-promise and over-deliver.
The apparent winners from COVID-19 were beaten down in the hygiene theme, and it’s a good time to buy. Cramer likes Procter & Gamble Co (NYSE: PG), Clorox Co (NYSE: CLX), and L Brands Inc (NYSE: LB).
The fourth bullish theme is home improvement, as it’s unaffected by the stimulus. Cramer likes Masco Corp (NYSE: MAS), Home Depot Inc (NYSE: HD), Lowe’s Companies Inc (NYSE: LOW), and Walmart Inc (NYSE: WMT).
Autos are the fifth bullish theme as individuals want to avoid crowded areas and mass transit transportation. Cramer likes Ford Motor Company (NYSE: F), Tesla Inc (NASDAQ: TSLA), and Lithia Motors Inc (NYSE: LAD).
Procurement Nation’s Take: The market is going down on fears of a lockdown due to rising coronavirus cases, stimulus stalemate, and the upcoming presidential election.
Once the election is over, a stimulus will come eventually. The pandemic will die down too. Big decline days like Wednesday present investors with an opportunity to keep their shopping list ready, but it’s also okay to have a wait-and-watch approach and not buy anything.
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