A string of corporate mergers help provide insight into this market, Jim Cramer says

  • CNBC's Jim Cramer advises investors not to be "too negative" the next time the market sells off, given the string of corporate acquisitions announced Monday.
  • The "Mad Money" host pointed to the benefits of mergers and acquisitions to help gauge valuations and sentiment on the market.
  • "Big companies tend to know their own industries, and they seem to think many stocks are undervalued or reasonably valued," he said.

Wall Street was flooded with new corporate deals, and that gives investors insight into company valuations on the market, CNBC's Jim Cramer said Monday.

"There will be more sell-offs ahead — this is still September; the last week of September is supposed to be bad. But the next time the market gets slammed, I want you to remember what happened today and I want you to try not to be too negative," the "Mad Money" host said.

In a Merger Monday, a wave of newly announced acquisitions gave a boost to a market that proved turbulent in recent weeks. The Dow rose almost 328 points, or 1.18%, to 27,993.33. The S&P 500 advanced 1.27% to 3,383.54, and the tech-heavy Nasdaq Composite rallied almost 2% to 11,056.65 during the session.

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Among the bids that helped to influence trading were moves from Gilead Sciences, Nvidia and Oracle.

Gilead made a $21 billion play, paying $88 per share in cash, for biotech company Immunomedics to expand its cancer treatments. Immunomedics shares nearly doubled during the session to close at $83.65. The stock closed Friday at $42.25.

Gaming chipmaker Nvidia offered $40 billion for mobile phone chip manufacturer Arm Holdings. Despite what Cramer believed to be a high purchase price, Nvidia shares rallied almost 6% to $514.89 on the news.

As for Oracle, the enterprise database software provider beat out Microsoft in a highly watched bid for TikTok's U.S. business with ByteDance in China. The deal will make Oracle an American technology partner and give the company a big interest in the video platform.

"What matters here is that the market has spoken. Big-time hedge-fund managers may come on our air and say that stocks are too high, maybe even dangerous, that we're in a bubble," Cramer said. "But big companies tend to know their own industries, and they seem to think many stocks are undervalued or reasonably valued."

Disclosure: Cramer's charitable trust owns shares of Nvidia.


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