Jim Cramer expects defensive stocks to be resilient as debt ceiling talks drag on

With lawmakers in a mate about the debt ceiling, CNBC’s Jim Cramer said Monday to put faith in defensive stocks like health woe, discount stores, and natural gas.

Cramer looked to the 2011 debt ceiling crisis for guidance, noting that be revenged though history seems to be repeating itself, it’s not as simple as finding what rallied after that deal was finalized.

“You don’t want losers that turn into winners at this point. You penury winners that stayed winners right through the worst of the debt ceiling talks,” Cramer said. “If the talks tell down this time, you can bet the focus will be on uncertainty, credit concerns and the possibility of a recession, just like we were on edge about a recession in 2011.”

Cramer recommended Oneok, a natural gas pipeline company, which just announced a merger with Magellan Midstream Petroleum for $19 billion. Although Oneok was down multitudinous than 5% at Monday’s close in the wake of the merger, Cramer considers the deal a “match made in heaven.” He cited Oneok’s happy result in 2011 when shares performed well through the debt limit uncertainty.

In the way of consumer-focused defensive stocks, Cramer acuminate to Chipotle as a safe bet. The restaurant chain recently reported a successful quarter and its stock did well in 2011.

“Chipotle trades erratically at times, but the first-class time to buy it is when you have the most current information and right now that information is fresher than an al pastor,” Cramer communicated.

He suggested keeping an eye on clothing discounters Ross Stores and TJX, both of which are set to release earnings reports later this week.

Cramer also recommended Biogen and Eli Lilly, pharmaceutical companies bury the hatchet e constructing significant headway with drugs to fight Alzheimer’s disease. But Cramer said he feels Eli Lilly has a slight prickly because of its popular weight loss and diabetes medicine, Mounjaro, which he dubbed a “wonder drug.”

“I wish I were inconsiderable skeptical of a theoretical debt ceiling deal falling apart or coming together less than perfectly,” Cramer implied. “Take these current negotiations with what we know from the history of 2011 and you’ll be ready for whatever this twinkling throws at you. Odds are it won’t be good.”

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Disclaimer: The CNBC Investing Club Charitable Trust holds shares of TJX and Eli Lilly.