While Wall Street may still be rattled after Monday’s massive sell-off, CNBC’s Jim Cramer said many of Tuesday’s corporate earnings reports do not indicate there is a serious recession on the horizon.
“I think we’re in a recessionless recession because I follow the actual micro data from individual companies that report,” he said. “When you run down the companies that reported in the last 24 hours, it’s very hard to make the case that we’re headed for a serious recession from here.”
Cramer listed several companies that reported solid quarters, including two cyclical outfits: equipment manufacturer Caterpillar and housing supplier Builders FirstSource. Both companies’ quarters were better than feared, he said, with Builders FirstSource putting up strong figures that will likely improve as interest rates come down. Cramer was also impressed by Caterpillar’s performance, especially at this point in the business cycle where the economy is “supposed to be teetering.”
Although some fear consumers are not spending money on discretionary items and services, Cramer pointed to solid figures posted by several companies in this category. Uber topped Wall Street’s expectations, and Cramer was impressed by the company’s increase in deliveries and gross bookings. If a recession were imminent, Uber would not be able to put up strong results, Cramer said.
He continued, pointing to other consumer discretionary companies that saw success on Tuesday, including Molson Coors; Planet Fitness; and Yum Brands, which owns Taco Bell, Pizza Hut and KFC.
“There was just great quarter after great quarter after great quarter this morning. They just can’t be seen by those who refuse to do the homework and only listen to central bankers,” Cramer said. “It does rankle me, but in the end, it doesn’t matter because we can see both the forest and the trees.”
