New mask rules mean drop lockdown stocks for reopening plays
U.S. health officials have loosened rules on masks for vaccinated Americans, but the new guidance sends a different message to Wall Street, CNBC’s Jim Cramer said Thursday.
“The CDC’s new guidance also means you’re going to get clobbered if you keep owning the lockdown stocks,” he said on “Mad Money.” “Instead, you need to circle back to the great reopening plays.”
The CDC, or Centers for Disease Control and Prevention, earlier Thursday announced that it no longer advises fully vaccinated people to wear a facial covering or stay 6 feet away from others in most settings. Face masks and social distancing mandates were put in place more than a year ago as a means to mitigate the spread of Covid-19.
The news was welcomed by investors, helping stocks rebound from multiple days of declines, Cramer said.
“You need to understand that this phase of the bull market’s all about keeping inflation tame enough so that the economy can grow without overheating and forcing the Federal Reserve to slam on the brakes,” he said.
Coming off its worst session since February, the market broke a three-day losing streak that was driven in part by concerns of rising inflation.
The Dow Jones Industrial Average and S&P 500 both rallied more than 1.2% during the trading day, and the Nasdaq Composite rose 0.72%. Meanwhile, the price of U.S. oil, an inflation contributor, dropped more than 3% after rallying four days straight.
“If oil, lumber, bitcoin and the ‘WoodStocks’ can keep going down … then you’re going to get many more days like today,” Cramer said. “If not, then this rally will turn out to be nothing more than a temporary reprieve.”
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