Home Blockchain News Investor guidance from Jim Cramer as the market shifts towards lower quality stocks

Investor guidance from Jim Cramer as the market shifts towards lower quality stocks

by Michael Stark

**Market Update: Profits Fall, Rotation in the Market Continues**

The S & P 500 is down on the day as the market experiences a major rotation.

*Major Profit-Taking and Rotation*
Investors are taking profits in this year’s leaders and mega-cap tech darlings, leading to a rotation of money into small caps and lower-quality companies with weaker balance sheets. The tough macroeconomic backdrop this year has caused these stocks to be beaten down, and investors are anticipating that if the Federal Reserve loosens its monetary policy next year, the economic pressures hurting these stocks will ease. However, it is cautioned that chasing lower-quality stocks is not a great long-term strategy and that it’s better to focus on buying high-quality companies when they are discounted.

*Stock Movements*
Microsoft (MSFT), Meta Platforms (META), Alphabet (GOOGL), and Palo Alto Networks (PANW) are falling, with some of these big names coming off their 52-week highs. On the upside, Estee Lauder (EL) and Foot Locker (FL) are showing positive movement. Estee Lauder is over 5.5% higher, which has been attributed to it being a “quintessential blue chip that has been crushed,” but investors are suddenly buying into it. However, it is cautioned that the reasons for this movement are not a valid reason to buy. Foot Locker is also experiencing positive movement.

*Trade Alerts and Trade Execution*
As a subscriber to the CNBC Investing Club with Jim Cramer, members receive a trade alert before Jim makes a trade. He waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has discussed a stock on CNBC TV, he waits 72 hours after the trade alert before making the trade.

It is important to note that the above investing club information is subject to terms and conditions and privacy policy, and there is no guaranteed specific outcome or profit. No fiduciary obligation or duty exists based on the information provided.

You may also like