Jim Cramer: Here's What the Market Is Now Concerned About

 | Mar 13, 2018 | 1:24 PM EDT
  • Comment
  • Print Print
  • Print
Stock quotes in this article:




Nearly everybody in tech has business in China. It's where the growth is.

So if we see Broadcom's (AVGO) acquisition of Qualcomm (QCOM) be blocked because of worries by the U.S. government that Qualcomm is a crown jewel where its 5G technology can't be shared with China, don't we have to be worried that all of tech that wants to be big in China could be under pressure?

Further should we be concerned that the new Secretary of State, Mike Pompeo, has had a much harder line on China than the former Secretary of State Rex Tillerson?

That's what this market's saying today and I think the concern is real if there is follow-through.

But, there are two theories at play here. One is that the U.S. is very concerned about intellectual property going into Chinese hands. However, the other is that perhaps this is a lone case and that the president has no desire to stop commerce with China but to try to limit the amount of theft that he perceives occurs with our companies and the Chinese.

It's so easy to overreact to these kinds of things but they certainly DO make sense to react to.

That's why it is certainly reasonable to believe that tech should take a breather until we have more clarity.

It's ironic but the real story here might be what happens if Larry Kudlow becomes chief economic advisor. I think that while Larry's gotten tougher on China I know I would feel better about tech if he got in because he wants to walk the fine line of having good business with China but not giving anything away to them.

It would be an excellent sign that the Committee on Foreign Investment in the United States will not stand in the way of all tech deals, something that's very important if the sector is going to get more lift.

But, again, it's too early to tell. Right now all we know is that if the Broadcom-Qualcomm shoot down is bigger than there could be a pause in a rally of pretty much epic proportions.

Too early to tell, nevertheless a decent concern until we know more about the president's next move on the topic.

Columnist Conversations

Most investors have given up on Vera Bradley (VRA) , but the punishment may not fit the crime, and the company...
When the whole world sells off everybody wants to assign a reason for the action. Today's suggestions: 1...
For the first time since early February the down volume as a percentage of total volume on the NYSE is over 90...



News Breaks

Powered by
Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.