CNBC’s Jim Cramer said Monday that investors should not overreact to the new strain of Covid-19 in the United Kingdom, criticizing that country’s response to the pandemic and pointing to positive news about U.S. companies as a reason for optimism.
“I am not willing to give up on this market because of a 70% number in the U.K., when the U.K. has been particularly, let’s just say, absent in the way it’s handled this,” Cramer said on “Squawk on the Street.” “We can all take every single cue we want from the U.K., or we can take our cue from some of the companies that are going to be doing quite well here.”
The U.S. stock market opened lower on Monday after the U.K. said it identified a new strain of Covid-19 that is 70% more contagious than prior strains. Stocks in Europe were also down sharply. The Dow was last down about 300 points.
Several European countries banned flights from the U.K., though experts have said that the recently approved vaccines from Pfizer and Moderna will likely be effective against the new strain of the virus.
The “Mad Money” host pointed to the agreement on a new stimulus deal in Congress, strong earnings from Nike and the return of stock buybacks for banks as positive catalysts for the market.
Cramer also mentioned Citi’s upgrade of Microsoft to buy from neutral, saying tech stocks could again perform well in the event of a new round of economic restrictions. Shares of Microsoft were down 0.4% in early trading.
“You shouldn’t throw out all stocks. Look at how these companies that do so well when we lock down have performed,” Cramer said.
The U.K. has confirmed more than 2 million cases of the virus during the pandemic, according to data from Johns Hopkins University. On a per capita basis, that is fewer infections than registered in the United States but more than seen by some other peer countries, including Germany and Canada.
U.K. Prime Minister Boris Johnson has also instituted increased business and gathering restrictions for much of the country, including London, over the Christmas holiday season to slow the spread of the virus.