Cramer says two recent earnings reports may indicate a slowdown is brewing — but not enough for a Fed cut

CNBC's Jim Cramer on Thursday said disappointing quarters from trucking company J.B. Hunt and real estate investment trust Prologis may be a sign the strong U.S. economy is starting to weaken under the weight of elevated interest rates.
However, he stressed that it's still too early for the Federal Reserve to start cutting rates.

CNBC's Jim Cramer on Thursday said disappointing quarters from trucking company J.B. Hunt and real estate investment trust Prologis may be a sign the strong U.S. economy is starting to weaken under the weight of elevated interest rates. However, he stressed that it's still too early for the Federal Reserve to start cutting rates.

"So, do we finally have the beginning of the long-awaited slowdown with Prologis and J.B. Hunt? Was March that bad?" Cramer asked. "All I can say is that at least there are some brown shoots somewhere. But the bottom line is, it's not enough to cause the Fed to reconsider what they were saying just a couple of days ago."

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After a hotter-than-expected consumer price index report, Fed Chair Jerome Powell said last week that inflation has not declined enough for the central bank to consider making rate cuts in the near future. The Fed has held its benchmark interest rate target steady since July 2023 after issuing 11 consecutive hikes in about a year to combat post-Covid inflation.

Cramer said he maintains that the economy is too strong for rate cuts, and has been telling investors that they "shouldn't hold their breath" for the Fed to start easing rates. However, he did acknowledge that companies operating in economically sensitive industries such as J.B. Hunt and Prologis, in trucking and warehousing, respectively, did show less-than-ideal earnings results.

"For the first time in this rate hike cycle, I see light at the end of the tunnel, just when others see the light of an oncoming train," he said. "Before there are bargains for Prologis, there will be free rent enticements for the customer. Before a turn in trucking, there'll be cuts in trucking rates."

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J.B. Hunt did not immediately respond to request for comment.

"A volatile and persistently high interest rate environment — together with mounting geopolitical concerns —is definitely impacting our customers' decision making on taking on new space," Prologis CEO Hamid Moghadam told CNBC in emailed statement. "Given our world-class portfolio with significant embedded rent growth, we are confident about our ability to deliver sustained, long-term earnings."