Tuesday, the stock market told investors to “don’t worry, be happy,” Jim Cramer told his Mad Money viewers. That’s because no matter who wins the presidential election, your portfolio is going to be just fine.
Cramer listed several reasons for Tuesday’s strong market rally. For one thing, investors are breathing a sign of relief that the most contentious election in recent memory is finally winding to a close. There are glimmers of hope for an orderly transition of power if Joe Biden wins and hope for a second round of economic stimulus sometime between now and January.
But mainly, Cramer said, investors are responding to the fact that we saw weakness in stocks last week, leaving opportunities for this week. We are also seeing strength in the economy, with housing and autos leading the way. That’s good news for a host of industries, from materials to the railroads.
The Dow Jones Industrial Average finished up 555 points Tuesday, or 2.06%, to 27,480, the S&P 500 gained 1.78% and the Nasdaq rose 1.85%. At one point Tuesday the S&P 500 had risen 2.4%, its best one-day performance since June. Financial, industrial and tech stocks were the leading gainers Tuesday.
As for the results of the election, Cramer said if Trump wins, we’ll be in for more of the status quo, which has been pretty good for the stock market. However, if Biden wins, we’ll likely see more trade and more immigration, and that will lead to more economic activity. So no matter who prevails, your portfolio is likely intact.
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Off the Charts: Gold
In the “Off The Charts” segment, Cramer checked in with colleague Carolyn Boroden over the direction of gold in these uncertain times.
Boroden was optimistic on the outlook for gold. She noted the precious metal’s weekly chart have a bullish pattern of higher highs and lows up until its recent weakness. She saw a floor of support between $1,827 and $1,853 and maintained a price target of $2,153 an ounce.
Turning to the daily chart, Boroden correctly predicted gold’s October lows with a convergence of Fibonacci timing cycles. She saw several support levels between $1,906 and $1,939, which signaled to her that gold has a lot more room to run if it can stay above these levels.
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At the time of publication, Cramer’s Action Alerts PLUS had no position in the stocks mentioned.