CNBC’s Jim Cramer blamed Monday’s stock market decline on messaging from the head of the U.S. Treasury.
On Sunday, Secretary Janet Yellen told Bloomberg News that raising the interest rate would be positive for the country, should the Biden administration’s big spending plans help trigger some inflation in an expanding economy.
“The prospect of higher interest rates spooked the market,” Cramer said on “Mad Money” reacting to the mixed session on Wall Street.
The Dow Jones Industrial Average slid about 126 points, or 0.36%, to close at 34,630.24. The S&P 500 finished 0.08% lower at 4,226.52. The Nasdaq Composite, however, was a winner and advanced 0.49% to 13,881.72.
Yellen, a former Federal Reserve chair, told Bloomberg President Joe Biden’s $4 trillion rescue package could break down to $400 billion in spending each year, but argued any jump in consumer prices would subside next year.
“It caused sellers to [do] what’s known as ‘hit bids’ all over the place,” Cramer said, referring to when traders are willing to sell a stock below a buyer’s bid price.
That helped bring down the stock of steelmaker Nucor, one of the best gainers in the S&P 500 this year. Nucor shares bounced from their lows to close at $107.37.
“The sellers overwhelmed the buyers, hit all the bids down” to an intraday low of $105.51, down from $110 last week, Cramer said.
“I think it’s a fabulous buying opportunity. Nucor has multiple years where it does well when the [business] cycle gets going,” he said. “But the stock closed down more than 1%, which put me in an oppositional camp.”