Lots of times I write "focus" when I respond to a person who asks a silly question on Twitter @JimCramer. Sometimes I have to tell myself to focus on what's happening, too. I have to focus on what's driving this market today, because that shake-off from the early morning blues is pretty darned positive.
First focus: The market's hard to sink when the dollar goes down in value. The strong dollar is the enemy of pretty much everything American these days, from our profits to our hiring. Our so-called "partners" in trading are killing us by causing their currencies to get crushed to win business from U.S. companies. That's what this year has been all about. It is why most global stock markets are higher and our averages are way behind. It's why the IMF raised its growth forecast for Europe and cut U.S. growth estimates.
I think what our allies are doing is intolerable, made doubly terrible by no politician speaking up for our industries that are losing jobs and profits to these currency debasers. Our workers and investors are being sacrificed upon a cross of globalization. It's a false religion that no one seems willing to call out. But when the dollar gets hit, our markets can go higher. And that happened today.
Second, Johnson & Johnson (JNJ) reported a number that looked hideous, but the colossal shortfall was all because the dollar was too strong and that repulsively powerful greenback completely obscured the excellent growth that CEO Alex Gorsky delivered. And what happened? People overlooked it. If they overlook it with JNJ they will overlook it with others because JNJ is one of the most internationally oriented domestic companies. The stock's inability to go down tells you that investors aren't freaked out about really bad numbers caused by weak currency translation, and that's huge. They see through it!
Third, oil seems to be done going down. So far the $43 level that I said would hold has. Remember, I only said it because the real authorities, the guys who transport oil, gas, and refined products, Rich Kinder of Kinder Morgan (KMI) and Mike Mears of Magellan Midstream Petroleum (MMP), came on Mad Money and said oil didn't belong down at $43, roughly where it was when I talked to these two CEOs. We do not want oil to keep plummeting because it will soon cut into job growth and we started seeing that happen in March. The oil and gas stocks are flying and that's fabulous because we need this group to stop being worrisome. We don't want oil in the $60s, but we don't want it plummeting through $40 either. It's a real "Goldilocks" moment and my charitable trust has been gobbling these stocks up. I do not think the train has left the station. There can be moments when oil goes back down. But the rest of the world's getting stronger and our production growth has peaked.
Now, I want to be clear, I want lower oil prices. However, I am being forced to focus on the fact that big investors out there want to see oil stabilize and they are getting just that. Right or wrong, that emboldens them to buy. And nobody wants to see a calamity where many big companies go under. We know now that's not going to happen. There's too much money that wants in on oil, whether it be in these fabulous secondaries or in private equity. It's the greatest disaster that never was.
Fourth, interest rates are going down and I am never against that happening if I own stocks. The competition to stocks from bonds is going away again. That makes the dividends golden and reminds us that the Fed's right not to tighten. Plus, today we got weak aggregate retail sales and very low inflation. That keeps the Fed bogeyman on the back pages and you have to love that. Those people constantly calling for rate hikes, including those gasbag Fed minions, look too stupid to talk right now and that's sensational. It reminds us that Janet Yellen's in charge, not them, and with the help of Vice Chair Stanley Fischer she's got our backs.
Fifth, the activists just don't quit. We are hearing rumblings from some largely passive investors -- I call them pacifists-that are bemoaning the work of activists. I have made it clear that some activists do a good job and some do a weak job, some are operators and some are just promoters, just like some CEOs. I also think some boards are responsive and others aren't. I am delighted if some shareholders hold the feet of CEOs and boards to the fire. If my trust owns the stocks I am grateful. I was very grateful for what Jana Partners, which just took a stake in Qualcomm (QCOM), was able to accomplish pushing Walgreens (WBA) into taking radical actions that have added about 50% to the stock price. How in heck is that bad? Again, case by case, but with its emphasis on creating returns, what's not to like? You should go buy some Qualcomm. It's probably done going down.
Sixth, take a look at the soaring stock of General Electric (GE). This dog just wouldn't hunt as long as it had too much financial and not enough industrial. Bingo, in one fell swoop the company offloads its financials at a fabulous price, and will use the proceeds to buy back stock and be opportunistic buying real businesses. The company's stock has gone from being in a total no fly zone to being a must own for portfolio managers everywhere. This kind of thing must be focused on. It's fabulous.
Seventh, while Norfolk Southern (NSC) preannounced a terrible quarter last night with a marked weakness during March, the market's shrugging it off, attributing the worst of it to coal, and is willing to ignore it somewhat because a large trucking company JB Hunt (JBHT), said some pretty good things. What matters here is that rightly or wrongly, people are willing to overlook a weak quarter. And I think I have to focus on that reaction.
Eighth, JPMorgan Chase (JPM), a huge bank, this morning reported a monster number with core earnings north of $6 billion. The legal bills are down, the earnings for each business up, and the dividend is growing still again. The market loved it and sent the stock to a new high.
Sure the market didn't like Wells Fargo (WFC), but I want to tell you I think it is a fantastic buy because it's still making fortunes; it just can't get the return it would like right now on its deposits. If you are willing to think a little longer term it's a terrific buy and I sure wish my trust could buy more but we are frozen because I talked about it.
Ninth, expectations sure did get low as some stocks went lower. I am speaking to Zillow (Z) CEO Spencer Rascoff tonight about the earnings. It missed its quarter because of some difficulties it has had integrating the competitor it bought, Trulia, into its system. The stock plummeted 12 points at one moment on this news but it almost instantly recovered because, frankly, nobody was looking for a blowout quarter from the company, which was down from $160 to $80 and enough was enough. As I said last night, some companies would be worth twice what they are selling for if they were private. This is one of them.
Finally, the tenth development to focus on? Apple (AAPL). The stock didn't plummet after the Apple Watch numbers came out. So often there's some misinformed analyst or analysts -- oh boy, what a diplomat I have become -- who downgrade the stock because they are disappointed by some high-profile Apple sales number. No one played that game. Maybe people recognize that the Watch will be something that those under twenty-five demand, a terrific graduation present -- I will be buying four of them -- a gorgeous accessory with many bands needed and a health dashboard that gives me almost as much of a read on my body as I have on my car. We're getting there. Maybe people realize it can stimulate iPhone sales, too. Or maybe they finally get that you should own, not trade, Apple.
Yep, sometimes you have to focus on the way the market's focusing on the inputs we're getting. And the focus today is too positive to ignore, even if you think, in your heart of hearts, that the risk-reward's not all that great for those who commit new money to this market.