Be conservative with FAANG stocks as expected Fed rate hikes lead to market contempt, Jim Kramer says

CNBC’s Jim Cramer said Thursday that he expects the market to turn into a bull market for recession-resistant stocks rather than expensive growth names.

when Federal Reserve decides to fight Inflated vortex with rising [interest] rates, you are not supposed to buy expensive growth stocks. The hedge fund’s playbook says you should sell stocks like Amazon until the narrowing cycle is nearly over,”mad money‘ said the host.

“We have a new bull market with recession-resistant names that can continue to raise good numbers even in the face of a slowdown,” he added.

The Dow Jones Industrial Average rose 0.25%. Thursday While the S&P 500 rose 0.43%. The technology-focused Nasdaq Composite Index is up 0.06%.

Cramer also said he believes investors should avoid buying shares of the biggest names in technology in the current market.

“I am adamant that you need to be very conservative with FAANG names and their ilk,” Kramer said. “Out of all these growth names, the only two I’d like to invest new money in” are a Google parent the alphabet and dad facebook dead It is not exorbitant for next year’s earnings, he added.

FAANG is an acronym for Facebook, Amazon, and an AppleAnd the Netflix and google.

Cramer cautioned that the transition to a bull market would not happen immediately.

“Pivot points don’t happen in an exchange rate, even if you feel like it,” Kramer said. “This is very difficult because for so long, the entire stock market has bent over in front of FAANG and friends.” “It was a bull market in a handful of stocks, a bear market in hundreds, if not thousands of others. Now, the bear is turning into a bull, and most of that will happen over the course of the next month.”

Disclosure: Kramer’s charitable fund owns shares in Meta, Amazon, Apple, and Alphabet.