Infrastructure deal resulted in a “jailbreak” second in shares
Wall Street experienced a breakout moment in trading Thursday as stocks rebounded after Washington lawmakers reached an infrastructure deal, CNBC’s Jim Cramer said.
“If you want to sum up today’s grandiose action in one word, that word is jailbreak,” Cramer said in Mad Money. “I call it a jailbreak because pretty much everyone has been let loose today, rather than the usual I-win-you-lose pattern that has spoiled so much of the action lately.”
The S&P 500 and Nasdaq Composite posted record closing highs, while the Dow Jones Industrial Average jumped more than 300 points to approach its all-time high.
Cramer took on an optimistic tone in the marketplace as he shifted his focus from the Federal Reserve’s economic forecasts and future rate hikes to a breakthrough in stalled infrastructure negotiations.
President Joe Biden announced during the session that an agreement had been reached with a bipartisan group of Senators on “hard infrastructure” to allocate substantial funds for road and bridge reconstruction and broadband expansion.
Cramer warned that a reweighting of the Russell indices on Friday could cause stocks to decline, but he expects it will only fuel bullish momentum.
“Right now, I think any decline will be bought because this is a positive, opportunistic moment, folks, and there are many out there who want to put their money on work,” said Cramer. “Today’s jailbreak shows you that the cops are still in charge.”
Cramer highlighted stocks from a number of industries that he said benefited from the White House news. These included drug maker Eli Lilly, automaker Tesla, heavy machinery company Caterpillar, and Darden Restaurants, the parent company of Olive Garden.
Eli Lilly’s shares rose more than 7%. Tesla and Darden each gained more than 3%, while Caterpillar gained 2.6%.