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Is the economy getting better or worse?
That was the question on “Mad Money” host Jim Cramer’s mind, as stocks closed out another quiet session with modest losses Tuesday.
Cramer noted that, on one hand, the market received seemingly “bad news” from a few notable companies, including upscale leather goods maker Coach. It paced declines in the consumer discretionary sector after it reported lower-than-expected fourth-quarter sales, hurt by promotion deals it offered North American shoppers.
Investors should have gotten the hint that consumer discretionary spending had slowed when Starbucks reported disappointing earnings last week. The world’s largest coffee chain missed quarterly profit expectations and cut its outlook as visits to its U.S. coffee shops dwindled.
“Taking our cue from Starbucks and Coach may make a ton of sense, but then how the heck do we explain the strength in Whole Foods?” Cramer asked. “All three are expensive. All three can be traded down from. But only Whole Foods seems to have withstood the high-end onslaught and come through with flying colors.”
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