Jim Cramer says Trump is making it hard to value stocks accurately

Reviewing Tuesday’s market session, CNBC’s Jim Cramer said President Donald Trump‘s actions draw short sellers and prompt investors to make misguided moves.

“When you examine the market’s mistakes, they share a common theme: the president’s distorting pretty much everything, especially with his tariffs and his jingoistic approach to the rest of the world, and it’s continually confounding traders and investors alike,” he said. “People would just rather be short, they expect the market to come down every day.”

The indexes saw gains on Tuesday as the Dow Jones Industrial Average climbed 0.51%, the S&P 500 rose 0.58% and the Nasdaq Composite added 0.81%. Nvidia and peers lead the day’s advances, with the artificial intelligence darling closing up 2.80%.

Cramer noted that the averages have been opening down as of late. According to him, the market is “regularly getting sellers right from before the get-go,” as they anticipate Trump’s abrupt statements about trade, China or names like Apple and Nvidia — with some looking to profit from short term declines. But this strategy fails on days like Tuesday when the president is fairly quiet, Cramer continued.

Wall Street is too skeptical about the need for artificial intelligence infrastructure, he said. Cramer reviewed Nvidia’s performance over the past several months, pointing out that its stock has gone up and down as investors change their minds about the strength of the AI and data center theme. Nvidia’s stock fell as investors worried a Chinese start-up might present serious competition, but then it climbed after a strong quarter, Cramer said. The stock later gave back some of those gains as investors reeled from new trade regulations by the Trump administration, he added. Cramer then suggested Nvidia jumped during Tuesday’s session because Meta inked a 20-year nuclear power deal with Constellation Energy — which he said means the hyperscaler believes data centers are still necessary.

Cramer suggested Trump has “almost singlehandedly revived the short selling business.” He claimed that many hedge funds have started to heavily short stocks like Nvidia or CoreWeave, believing they can make money by “betting against stocks.” While the short sellers aren’t “in charge,” he added, they “have a lot of firepower and a lot of conviction,” as they figure they can’t lose with Trump in the White House.

“These short-sellers, they’ve grown way too confident, and today we found out they can lose big because lots of businesses are doing great,” Cramer said. “It’s just that Wall Street only notices on days when the White House doesn’t take up too much bandwidth.”

The White House did not immediately respond to request for comment.

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Disclaimer The CNBC Investing Club Charitable Trust owns shares of Nvidia, Apple and Meta.