CNBC’s Jim Cramer said Thursday uncertainty about the Covid delta variant in the U.S. is currently helping the stock market, contending it’s actually created “a best of all possible worlds situation” for the time being.
“Because we can’t tell whether delta has peaked, we’ve got to give [Fed Chairman Jerome Powell] the benefit of the doubt when he says that he’s got to hold off on tapering, especially since business has obviously slowed over the past few months,” the “Mad Money” host said, referring to the central bank’s decision a day earlier to keep its highly accommodative monetary policy in place for a little bit longer.
On the other hand, Cramer said there are some indications the worst of this Covid wave is over, which should help boost virus-sensitive parts of the economy after they saw momentary slowdowns.
As a result, Cramer said that “means we can buy the travel and leisure stocks, the retailers, the oils, not to mention the banks — they’ll all do better in a post-pandemic world.”
“In short .. you have a best of all possible worlds situation,” Cramer added, suggesting it’s a key reason why Wall Street has been able to rally the past two sessions after a sour start to the trading week. All three major averages are now positive for the week.
Many investors also feel better about beleaguered Chinese property developer Evergrande, Cramer said, helping improve sentiment during what’s historically a tough period for stocks.
“The bottom line? The absence of two negatives indeed does equal a positive, which is how you got this magnificent rally,” Cramer said.