Cramer on BloggingStocks: Eaton's a sign the bulls are in charge

Posted Jul 21st 2009 10:00AM by Jim Cramer
Filed under: Earnings Reports, Market Matters, Eaton Corp (ETN), Cramer on BloggingStocks

From TheStreet.com Network

TheStreet.com's Jim Cramer says all of Eaton's businesses declined; the stock, however, gapped and never looked back.

The Eaton (NYSE: ETN) (Cramer's Take) quarter was the tell Monday. Even more than the PPG Industries (NYSE: PPG) (Cramer's Take) quarter was last week.

In a vacuum, Eaton didn't do well. Its businesses all declined severely. Europe's bad, maybe even getting worse. The cash flow is not so hot. The outlook is really pretty grim. They didn't even give you the "mildly improved" language that rocketed PPG. I worried about the dividend immediately.

But the stock? It was up from the get-go. There wasn't enough bad to make the sellers come out of the woodwork this close to when things could improve. There was no decline from the first quarter. So without natural sellers, the shorts had to come in and cover -- and there are shorts on every industrial, every one.

So the stock gaps and never looks back.

After four weeks of pain, we are back in fierce bull-market mode.

We know this market can change on a dime. But the risk-reward has really shifted radically in favor of the bulls. Eaton, on that info, should have been down 3. Instead it goes up 3.

Which leads me to the obvious conclusion: What would have happened if Eaton had been good?

Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long PPG Industries.

Tags: etn, featured, jim cramer, JimCramer, ppg

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Reader Comments (Page 1 of 1)

7-22-2009 @ 5:04PM

beachpaul said...

Hey, we going back to DOW 9,000? Then what, a big selloff like the last three times?

7-22-2009 @ 1:35PM

Steve said...

@beachpaul

This "fierce" bull market (as Cramer describes it) cannot even be considered a bull rally. At best, it's a bull spurt. The way the stock market runs in fits and starts since last fall, I'd prepare for a selloff.

7-25-2009 @ 7:03PM

David Huntington said...

I don't believe a word this jerk has to offer. i will look elsewhere for my financial information. i came here to express my disgust with this hippocritical pig.