Cramer says investors shouldn’t get caught up in ‘gloom’

  • CNBC’s Jim Cramer told investors on Tuesday not to let their perception of stocks get clouded by “gloom,” and encouraged them to focus on the overall health of companies rather than stock movements.
  • “If you let depression get the best of you here, I think you will make the classic mistake that many people make,” he said.

CNBC’s Jim Cramer warned investors on Tuesday not to get caught up in the “gloom” feeling surrounding Wall Street — especially in September, a historically low month for the market — that is dragging down shares of companies he sees as strong.

“If you let the gloom take over here, I think you’ll make the classic mistake that many others make: Instead of panicking, you realize it’s September, it’s just September rain, nothing more is controlling your emotions,” Kramer said. “Once we get through this difficult seasonal period, things will feel very different, and the gloom will finally go away.”

Sometimes factors that have nothing to do with the actual health of a company cause stocks to decline, Cramer explained. He used Disney as an example, saying its shares fell more than 3% on Tuesday after the company announced it would nearly double its investment in its theme park business.

For Kramer, the move is a positive development, noting that Disney is investing in its brands and intellectual property that competitors like Netflix don’t have, and that shows the media giant has confidence in the strength of its balance sheet.

He also said gloom is clouding Wall Street’s perception of Nvidia — which ended Tuesday down about 1% — saying there isn’t any strong reason for the stock to decline. Kramer stressed that Nvidia still has powerful graphics chips necessary for artificial intelligence.

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Cramer also pointed to Starbucks’ recent decline and analyst downgrade, due to concerns about its performance in China. But he said the analyst who downgraded Starbucks “couldn’t take the pain any longer,” noting that concerns about China were not new.

“I will not take advantage of those disgusted and bewildered people who panic every time the averages go down and their stocks go down with them,” Cramer said. “If you let them, others, sellers, and pessimists do your thinking, you will sell into weakness, rather than buy into it. You will buy upfront strength when you should be letting things go.”

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Disclaimer The CNBC Investing Club Charitable Trust owns shares of Disney, Starbucks, and Nvidia.

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