"If you own a diversified portfolio, today was good day, but if you had too much concentration in the cloud names well this was pretty bad day," CNBC's Jim Cramer says.
"I think some funds could be selling the cloud stocks so they have capital to participate in these IPOs," the "Mad Money" host says.
"A lot of money managers are betting we'll get a trade deal in the not-too-distant future, which is why Boeing and Caterpillar roared higher today," he says.
Cloud stocks took a tumble during the trading session that was potentially fueled by investment funds raising cash to get ready for the next big initial public offering, CNBC's Jim Cramer said Thursday.
While the S&P 500 tallied its first six-day winning streak in more than a year, the biggest cloud names were in the red including ServiceNow NOW , which lost more than $10 on the day, and Salesforce CRM , which fell more than $4.
"If you own a diversified portfolio, today was good day, but if you had too much concentration in the cloud names well this was pretty bad day," the "Mad Money" host said.
Lyft LYFT shares, after falling near $66 per share after its public debut Friday, closed up nearly 3% at $72, its initial IPO price.
Cramer said it's his "biggest fear" that growth funds are selling stocks to prepare for the looming IPOs that will be handled by firms that want to avoid botching the deal as Lyft's.
"It makes sense when you look at the performance of today's big deal, Tradeweb TW , a financial services-slash-technology company that jumped gigantically and in an orderly fashion," he said. "I think some funds could be selling the cloud stocks so they have capital to participate in these IPOs."
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Anticipating a deal
Investors made a move on industrial stocks in anticipation that a U.S.-China trade agreement is near completion, Cramer said.
"A lot of money managers are betting we'll get a trade deal in the not-too-distant future, which is why Boeing BA and Caterpillar CAT roared higher today," the host said.
The world's two largest economies reportedly made progress in trade talks this week, and stocks gained on the news . The Dow Jones Industrial Average, powered by Boeing's nearly 3% rise, added more than 166 points on the session and the S&P 500 gained 0.2% for its first six-day winning streak in more than a year.
The Nasdaq, on the other hand, shed 0.1% .
"While I'm very skeptical about these negotiations with China, because I know that [the U.S.] wants to keep the tariffs on no matter what, the stock market is saying: 'hey, a deal is a deal,'" Cramer said. "This kind of positivity seems counterintuitive in the face of the conventional wisdom about this market."
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Special delivery
GrubHub GRUB will continue investing in its long-term strategy and differentiate itself in the crowded online food ordering space even as its stock faces pressure, CEO Matt Maloney told CNBC.
"I have always been willing to be extremely aggressive investing in the future," he said in a Thursday one-on-one with Cramer.
Cramer noted that Wall Street is "short-sighted" and typically frowns upon news that a company will make investments because investors are less inclined to buy into the long-term view.
GrubHub's stock is down about 9% in 2019 and off more than 50% from its all-time high in September.
"It's the cost of being public," Maloney said, shrugging off those concerns.
More here
Trust your intuition
Intuit INTU has a new management team. Cramer said the company's leadership seems to be executing, but cautioned that the stock is a bit expensive as it has run up dramatically.
It's up more than 33% in 2019.
"The story's all about conviction. If you believe in Intuit's strategy, if you think they'll be able to blow away the numbers, then the stock's worth buying even up here," he said. "But if you don't have that kind of conviction in an unproven management team, at least yet, I can't blame you for taking a pass on this one."
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Toast to Constellation Brands
Canopy Growth CGC could generate more than $1 billion in revenue by the end of its fiscal year, Constellation Brands STZ CEO Bill Newlands told CNBC.
Constellation, which makes Corona and Modelo beers, has a 38% stake in the cannabis company, which is the largest medical marijuana producer in Canada.
"If you look at Canada alone, Canada is on a run rate of $5 [billion] to $6 billion in sales, and Canopy is the leading player in that market," Newlands told Cramer. "Then you add in new form factors later this year in things like beverage and other edibles, we think the sky's the limit. This is going to be a big business, and Canopy is going to be the leader."
Read more on the interview here
Cramer's lightning round: Vans is doing really well. Buy this stock
VF Corp. VFC : "I think Vans is doing so well that you're going to do quite well. I'm thrilled they're getting rid of the jeans business, that is too competitive."
Office Properties Income Trust: "I gotta look into that. That's a stunning decline. It's gotten a little better this year, but I gotta find out exactly what they merged with that nobody likes. That's a cheap stock, we're going to come back."
Anadarko Petroleum Corp. APC : "I have a conference call next Friday for members of the ActionAlertsPlus.com club. Last conference call I beat myself up severely about how Anadarko turned out to not have what I wanted in terms of growth. This quarter I think will be much better. A 2.6% yield, good balance sheet. I think Anadarko's fine. I think you make six bucks in it."
Okta Inc. OKTA : "You now I like those guys. That stock at one point was so hammered today, you couldn't look at it. It was like looking at a total eclipse of the sun. Yeah, so I think that, you know, that's the one that's the identity software. It's kind of a Salesforce spawn. I like it very much, but remember it's a long-term play."
Disclosure: Cramer's charitable trust owns shares of Salesforce.com
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