On Tuesday, CNBC’s Jim Cramer gave investors his blessing to consider buying battered tech stocks after Target’s latest quarterly signaled good news for the Federal Reserve’s fight against inflation.
“The real green light here is on beat tech. … They might deserve a bit of a resurgence if they have earnings and a full rage if they have buybacks and dividends,” he said.
“It’s not a subtle market. I don’t want you to think about it too much because sometimes it can be easy,” he added.
Cramer’s comments come after Target said in its most recent quarter that it will have to shed excess inventory, which in turn will limit the company’s profits.
The “Mad Money” host, who the day before had advised investors to buy the drop only on oil stocks, said news from Target suggested inflation was peaking. This opens the door for investors to buy stocks that were previously untouchable in a high interest rate environment, he said.
Listing ServiceNow, Broadcom and Salesforce as more attractive names after the Target news, Cramer said he was still staying away from short-term retail stocks.
He also warned investors that this shift in the market could fade as quickly as it came, due to the volatility in the economy.
“Of course, this market is so finicky that this whole thing could reverse when we get the big consumer price index at the end of the week. … That could push long-term interest rates up again , putting this whole movement on ice,” he said.
Disclosure: Cramer’s Charitable Trust owns shares of Salesforce.