CNBC financial analyst Jim Cramer has attributed recent distortions in market behavior to former U.S. President Donald Trump's trade policies and nationalist rhetoric, claiming that they have revived the short-selling business across Wall Street.
According to a report from Mars Finance, Cramer stated that Trump’s unpredictable trade announcements have triggered a pattern of "sell-offs at market open," as traders brace for potential negative remarks targeting global trade or high-profile companies like Apple.
“There is a common reason for recent market misjudgments: the president's tariff policy and his nationalism toward other parts of the world continue to disrupt trading decisions,” said Cramer. He explained that the speculative behavior has emboldened short sellers, particularly hedge funds targeting major tech firms such as Nvidia and CoreWeave, hoping to capitalize on policy-induced volatility.
However, Cramer cautioned that this short-term strategy is fragile and could result in significant losses, especially when Trump refrains from making market-moving statements. He noted, “Trump has almost single-handedly revived the short business,” but emphasized that strong corporate earnings are being overlooked due to heightened political noise.
Cramer warned that while shorting stocks amid political uncertainty might seem profitable, it risks ignoring underlying fundamentals, potentially leading to misjudged trades and poor long-term outcomes.