CNBC’s Jim Cramer said Monday that a series of mounting risks has made him significantly more cautious on stocks.
“I am not that bullish,” the “Mad Money” host said. “My bullishness can wait. I think you will get a better time to buy than right now.”
The caution comes as several pillars of Cramer’s bullish outlook have come under pressure. A surprisingly strong jobs report has reduced the likelihood of Federal Reserve rate cuts, while the looming SpaceX IPO, weakness in Apple, and the prospect of additional AI-related fundraising have raised new questions about whether the market can sustain its recent rally.
“Things have changed. For the worse,” Cramer said. “There’s a shroud over this market and you ignore it at your own peril.”
At the top of Cramer’s list is Friday’s surprisingly strong employment report, which he said undermines the case for rate cuts this year.
Cramer said expectations for one or two rate cuts had been a key pillar of his bullish thesis. Now, he believes the report was strong enough that “you could argue we might need a rate hike to cool the economy, not a rate cut to turn the temperature up.”
He also expressed concern about the upcoming SpaceX IPO. While demand for the offering appears robust, Cramer warned that an overly enthusiastic debut could ultimately backfire if the stock surges to unsustainable levels before falling sharply.
“What happens if it opens too high simply because there’s not enough stock to go around, and then we watch a sickening decline after that moment?” he said. “That could be very bad. It would color things very negatively maybe for some time.”
Apple is another source of worry. Cramer said he hoped the company’s Worldwide Developers Conference would serve as a catalyst for the stock, but shares instead moved lower.
“Apple is a leader, maybe the leader, and I don’t want to lose the leader of this stock market,” he said.
Finally, Cramer pointed to Alphabet’s recent $80 billion equity raise to fund additional artificial intelligence infrastructure. While he praised the offering’s execution, he worries it could encourage other technology companies to tap investors for capital, potentially draining liquidity from the broader market.
Taken together, Cramer said the prospect of higher rates, uncertainty surrounding the SpaceX deal, Apple’s struggles, and the risk of additional equity offerings create a far more difficult backdrop for stocks.
“So, rate cuts from the Fed are likely off the table, the SpaceX deal will suck money from the rest of the market, more equity offerings could do the same thing, and now Apple’s getting clocked, too. That’s more negativity than I can handle,” he said.
