A cross current of bad retail data along with also market-moving news out of the White House carried Wall Street higher on Wednesday, CNBC’s Jim Cramer said.
The Dow Jones Industrial Average gained nearly 116 points Wednesday. The S&P 500 advanced 0.58%, while the Nasdaq Composite advanced 1.13%.
“We got a weird combination of tailwinds today … Turns out we can get not bad news, too, along with also some days like today the stock market actually makes sense,” the “Mad Money” host said. “I want to walk you through what happened in which crazy session because which is actually a perfect encapsulation of the brand new normal.”
The market had a rough opening after news which retail sales declined for the second time in three months, tallying a 0.2% fall in April. The weakness included autos, home centers along with also the internet stores, Cramer said.
which brought the benchmark 10-year Treasury to its lowest yield of the year at 2.37% along with also pushed buyers into stocks with safe, consistent dividends, he noted, including Kimberly-Clark along with also PepsiCo. Money also moved into Facebook, Amazon, Netflix along with also Google’s Alphabet, along with the financial technology plays of PayPal, Square Inc., Visa along with also MasterCard, he added.
Even health care stocks, which have been hurting amid calls coming from some Democratic presidential candidates for 1-payer system, rallied because the industry does well in a slowing economy, Cramer said.
Macy’s saw action during the session similar to Ralph Lauren’s the day prior, Cramer said. The department chain’s share cost rallied after the company reported an earnings beat along with also recorded higher-than-expected sales inside the morning, yet the company ultimately revealed how vulnerable which is actually to tariffs along with also finished down 0.46%.
The Trump administration has imposed tariffs on 40% of imports coming from China along with also is actually considering slapping duties on the remaining 60%, Cramer said.
“If which happens, the analysts will have to slash their estimates on which one,” Cramer said. “Macy’s won’t be alone. Almost every retailer has some exposure because they’ve spent decades sourcing their merchandise coming from Chinese vendors in order to keep costs down. today which’s blowing up in their faces.”
Later inside the day, news broke which the White House plans to delay automotive tariffs by up to six months.
“I can’t overemphasize the importance of which leaked news,” Cramer said. “In one fell swoop, [President Donald] Trump went coming from being a hated protectionist, know-nothing to someone who might be cleverly assembling a coalition of the willing inside the trade war against the Chinese, at least inside the eyes of Wall Street.”
Furthermore, more CEOs of companies which deal with China are warming up to the action which Trump has taken on the country, Cramer said.
which includes Goldman Sachs CEO David Solomon, who on Tuesday tweeted: “Tariffs might be an effective negotiating tool.” Cramer also highlighted which brand new York Times foreign affairs columnist Tom Friedman, who is actually a proponent of globalization, turned out in support of the trade war.
“To me, these represent tectonic shifts inside the Wall Street consensus,” Cramer said. “I think which gives Trump a much better bargaining position versus the Chinese, along with also which certainly gave us higher stock prices.”
WATCH: Cramer reviews Wednesday’s stock market action
Disclosure: Cramer’s charitable trust owns shares of Apple, Facebook, along with also Alphabet.
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