S&P 500 opened in the green this morning after the U.S. Bureau of Labour Statistics said consumer prices were up less than expected in the month of October.
Jim Cramer reacts to the inflation data
“CPI” – the consumer price index was up 7.7% last month versus a 7.9% year-on-year increase expected. Still, Jim Cramer cautions against translating the data as “all clear”. Instead, he wants investors to use this market optimism and minimise exposure.
We’re going to sell some stocks into the opening. We do like some of the different lines [in this report], but not enough. So, why not take advantage of this and do some selling?
For the month, consumer prices were up 0.4% in October versus the economists’ forecast for a 0.6% increase.
S&P 500 is still down about 20% versus the start of 2022.
S&P 500 is testing initial resistance
Core inflation (excluding food and energy) was at 6.3% versus last year and 0.3% for the month – also better than 6.5% and 0.5%, respectively that experts anticipated. Still, Cramer added on CNBC’s “Squawk Box”:
This kind of reaction has become very typical of an erratic market, and we just don’t want to wait for the next dip. It’s going to take more than just one month.
He took a dovish tone on crypto as well after the recent FTX fiasco that Invezz updated you on last night. All in all, any near-term optimism in the equities market, Cramer cautioned, was unlikely to sustain.
It is also noteworthy that the benchmark index is now testing its “100-day Moving Average” at the 3,910 level.