Many stocks are trading down Tuesday as if an economic recession is on the horizon even though one is not, according to CNBC’s Jim Cramer.
Stocks were up and down early Tuesday. Shares of Dow component J.P. Morgan Chase and Wells Fargo were under pressure, though well off their premarket lows, after releasing quarterly results before the bell. J.P. Morgan reported earnings that missed expectations for the first time in 15 quarters. Wells Fargo beat estimates on earnings but fell short on revenue.
Cramer appeared displeased with the market reaction, arguing investors are simply selling stocks “on the same bad news” that “we knew already.”
“A lot of stocks are trading down as if we are going to have a big recession, and we’re not going to have a big recession,” Cramer said on “Squawk Box. ” “Enough,” he pleaded.
Since late last year, there has been some fear on Wall Street that a recession is near. Economists see on average a 25 percent chance of a recession within the next 12 months, according to a recent Wall Street Journal survey, the highest level since October 2011 and up from just 13 percent last year.
Cramer disagrees. He reiterated his argument that the “bear market” in stocks ended after the Christmas Eve washout, which saw the S&P 500 sink 2.7 percent and slip into a bear market. Since then, the S&P 500 has rallied.
However, many analysts believe the market could still retest its lows, especially as earnings season kicks in.