Despite two positive days for the market, Cramer worries the gains may be temporary

CNBC’s Jim Cramer on Tuesday worried about the sustainability of the recent market action. Even though the major indexes saw gains over the past two days, Cramer asserted that these positives may rely on the results of the Federal Reserve’s Wednesday meeting.

Cramer used industrial equipment maker Caterpillar as an example. He said despite reporting decent earnings before Tuesday’s open, the company’s share slid. Cramer attributed this action to fears about the broader economy’s potential slowdown, with investors looking past the U.S. government’s plans to spend trillions on infrastructure.

“Those positives aren’t worth a warm bucket of spit in this market, because we re-evaluate companies every single day, every single hour, every single minute based on the macro environment, as controlled by the Fed and the long end of what we call the yield curve.”

To Cramer, this “instant wholesale revaluation process” may end only when long-term interest rate peaks, either because the bond market evens out, or the Fed resolves to stop rate hikes. But Cramer conceded that it’s unclear when that outcome may come to fruition.

“Positive days like yesterday and today make you feel like one of those bullish outcomes could be right around the corner, allowing us to have faith in the 2024 projections,” he said. “But we get smashed tomorrow and all of the stocks that rallied big today have those gains repealed instantly.

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Disclaimer The CNBC Investing Club Charitable Trust holds shares of Caterpillar and Meta.