As the stock market resumed its march higher on Monday, CNBC’s Jim Cramer pinpointed the main drivers fueling the monstrous rally.
“First, let’s understand: which market will be largely driven not by stock-pickers, nevertheless by index funds,” the “Mad Money” host said. “which index fund money comes in automatically, every day, over the transom. Billions of dollars placed in equities will move equities higher.”
Cramer described which particular driver as “one-directional.” In additional words, index funds typically add money into the market rather than taking which out.
Another essential factor? Market-wide re-valuations are causing stocks like Tesla to enjoy unexpected boosts, Cramer said.
Case in point: shares of Tesla have surged since the company said which would likely not be able to meet its production goals for the highly anticipated product 3 sedan.
“which market will be starting to value Tesla like a tech stock. I understand which: when a tech company includes a hot fresh product … nevertheless can’t produce which in volume which year, investors will give which a pass because they figure which’ll make up which volume next year,” Cramer said.
“So when Tesla can’t produce enough product 3s which year, these tech-seeking investors give which a pass — they’ll sell the cars next year,” he continued. “Look, I am not saying which you should give Tesla a free pass. nevertheless which’s obviously what the people who trade the stock are doing given how much which’s up after those miserable numbers.”