Jim Cramer explains why Trump’s trade deals didn’t bring on a market rally

CNBC’s Jim Cramer examined Monday’s market action and said he thinks the U.S.’s major trade deals failed to move stocks because investors’ focus is elsewhere this week.

“Right now, we’re presuming these tariffs don’t matter,” he said. “What matters is earnings, unemployment, the Fed meeting and — you know what — dead last, tariffs.”

The S&P 500 finished up 0.02%, while the Dow Jones Industrial Average lost 0.14% and the Nasdaq Composite closed up 0.33%. Over the weekend, President Donald Trump announced the U.S. reached a trade agreement with the European Union to place a 15% tariff on most European goods. The duty is lower than the 30% rate Trump had previously proposed, but it’s higher than the 10% tariff the EU hoped for. Trump also said the EU promised to buy $750 billion worth U.S. energy and invest another $600 billion in the U.S.

According to Cramer, some on Wall Street may have “tariff ennui” as they watch Trump’s trade deals unfold in a similar way — the U.S. threatens a high tariff but eventually pulls back as the trading partner offers to “throw in some sort of sweetener like a natural gas buy, or a big investment,” he said. The market has already rebounded from its post-Liberation day lows, Cramer added. At this point, he continued, investors aren’t buying stocks due to trade announcements unless something about the deal is substantially different.

Cramer also suggested that investors have tariff ennui because the U.S. has more major trade deals to settle — namely with China, Canada and Mexico — so negotiations are likely to continue for months.

Investors are also preoccupied with Big Tech earnings, Cramer said. Apple, Microsoft, Meta and Amazon are set to report this week, and he suggested the anticipation of their quarterly results overshadows news like the EU deal.

Wall Street is also fixated on the Federal Reserve’s Wednesday meeting and employment data set to be released on Friday. The central bank’s meeting comes as Trump’s criticism of Fed Chair Jerome Powell escalates. Citing inflation risks born from the president’s tariff policy, Powell has not cut interest rates — even as Trump has repeatedly pressured him to do so. The Fed is expected to hold rates steady, and Cramer said “we’re going to see a level of presidential hectoring that will be painful for the markets.” He added that he thinks Trump is likely to demand a rate cut whether Friday’s labor report is weak or strong.

“This week is a beast of its own and nobody on Wall Street is going to care about trade policy until the week is over,” Cramer said.

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Disclaimer The CNBC Investing Club owns shares of Apple, Microsoft, Meta and Amazon.