Prominent market commentator Jim Cramer has cautioned investors to continue maintaining a distance from technology stocks despite the rally seen on Monday.
“Just remember, if you were buying tech here off some weaker macroeconomic numbers, you’re not investing, you’re simply gambling,” Cramer said on CNBC.
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Major Wall Street indices closed mixed on Monday with the Nasdaq Composite being the only one to end the session on a positive note, led by gains in technology shares. Shares of Tesla Inc TSLA closed 5.93% higher on Monday.
The Dow Jones and the S&P 500 ended in the red. Investors and traders are awaiting Federal Reserve Chair Jerome Powell’s speech on Tuesday and consumer price inflation data on Thursday.
“These short-term sector rotations like we saw today — they’re irrelevant because they can’t last. Think renters, not owners. The fundamentals, now they last,” Cramer said.
The SPDR S&P 500 ETF Trust SPY closed 0.057% lower while the Vanguard Total Bond Market Index Fund ETF BND gained 0.27%. The Invesco QQQ Trust Series 1 QQQ closed 0.65% higher.
Despite its recent rally, tech stocks remain overvalued in a market that will continue to see pain, Cramer said.
He added that investors should consider recession-resistant stocks in sectors such as health care, industrials, oil and aerospace. “They were clobbered by the end of the day, and I think many of them actually represented some great [buying] opportunities,” Cramer said according to the report.
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Photo: Courtesy of Scott Beale on Flickr
Image and article originally from www.benzinga.com. Read the original article here.