Jim Cramerthe renowned CNBC host and former fund manager Wall Streetanalyzed the behavior of the market and suggested investors should remain calm in the face of volatilitysince setbacks can be an opportunity to reinforce positions in solid companies, as long as they are studied stocks in which you have confidence.
Wall Street reacts to stock declines
“When a sell-off hits the market, it’s time to consider adding to your favorite growth stocks”he pointed out. However, he cautioned that it is premature to jump right in, given that many companies are still trading near their all-time highs.
In fact, recommended waiting for new declines to take advantage of a more favorable entry point.
During Tuesday’s session, the main indices showed moderate declines. The Dow Jones lost 0.20%, the S&P 500 lost 0.38% and the Nasdaq fell 0.67%, pressured by doubts about the ability of technology companies to sustain the rise of artificial intelligence.
The biggest hit was Oracle, which fell 2.52% after reports of weaker performance in its cloud business and losses on contracts linked to Nvidia.
Despite the decline of the sector, Cramer insisted that you can make money in the stock market if you invest strategically. One of their recommendations is to buy gradually rather than all at once, thus reducing the risk of volatility.
Purchase opportunity
In his view, bearish days like Tuesday offer better buying opportunities than days of euphoria.
The analyst also highlighted his conversation with Jensen Huang, CEO of Nvidiafrom whom he heard encouraging comments about the future of artificial intelligence. Cramer assured that is willing to add more shares of the company if its price fallsconvinced that declines are part of the natural cycle of the markets.
Finally, he warned that the recent falls are not surprising, given the strong rally that technology companies have recorded in recent months.
However, he clarified that he does not perceive signs of a prolonged correction, but rather a reasonable adjustment after recent “parabolic movements”.
Source: Ambito
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