CNBC’s Jim Cramer said Wednesday that a market snapback is possible if the current biggest headwinds, the Russia-Ukraine crisis and soaring inflation, ease up.
“For the market, it’s a two-front war: The one in Ukraine and the one where businesses are now in trouble if they don’t raise prices aggressively. … Neither is intractable,” the “Mad Money” host said.
“We get a break in either one of these — inflation or Russian aggression — then you’re going to get a snapback rally of epic proportions, the kind of rally we haven’t seen since 2020 when the kids stopped playing Call of Duty and started day-trading,” he later added.
Cramer’s comments Wednesday came after the S&P 500 fell further into correction territory, ending the session almost 12% below its Jan. 3 record closing high. It was the broad equity index’s fourth-straight negative session, while the Dow Jones Industrial Average and tech-heavy Nasdaq Composite have registered five-day losing streaks.
Wall Street and markets around the world have been shaky as investors monitor Russian aggression toward Ukraine. In recent days, Russian President Vladimir Putin has ordered troops into eastern Ukraine while U.S. and European officials have implemented economic sanctions in retaliation.
At the same time, rising inflation continues to dog the U.S. economy, and in response, the Federal Reserve is expected to issue a quarter-point interest rate hike in March. The market expects further increases throughout the year.
If neither issue resolves, the market could be in for more tough times ahead, according to Cramer.
“Unless the West wins the war of words with Russia or Powell slays inflation, you have to expect more of these torturous days and fewer tortured young traders,” he said.