CNBC’s Jim Cramer said he believes Tuesday’s broad rebound on Wall Street was a “snapback rally,” encouraging investors to be patient before jumping in to buy stocks.
All three major U.S. equity indexes finished in the green Tuesday, led by the tech-heavy Nasdaq Composite‘s 1.25% gain. The S&P 500 advanced 1.05%, while the blue-chip Dow Jones Industrial Average added 311.75 points, or 0.92%.
“This is strictly a snapback rally. It’s hard for these moves to last because there are still so many investors who want to get out. If we get anywhere higher, they’re gonna hit the exits en masse,” the “Mad Money” host said. “As we get closer to the end of the month, I told you I will get more and more positive.”
Tuesday’s gains came after a rough Monday session in which technology stocks, in particular, suffered steep declines. It’s been a rough few weeks for the market overall, with the S&P 500 down 4% in the past month. The Dow and Nasdaq have fallen roughly 3% and 6%, respectively, over that same stretch.
On Monday, Cramer suggested the market could see a brief jolt higher after weeks of steady declines. “This was a decent bounce,” Cramer said of Tuesday’s market moves.
“You had a chance to do get in ahead of it earlier in the day, but now that we’ve rebounded, I think you have to wait,” Cramer said Tuesday. “No need to come in on top of what might turn out to be quicksand. Just keep your bat on your shoulder and wait for the next opportunity to buy some high-quality stocks at better prices than you ever thought you could get.”
Sign up here for the new CNBC Investing Club newsletter to follow Jim Cramer’s every move in the market, delivered directly in your inbox.