Jim Cramer warns investors not to get fooled by the latest AI stock rally — SkimNews
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- Jim Cramer said investors were getting ahead of themselves by declaring the AI trade back on track after a second straight session of gains in AI-related stocks.
- Anthropic drew $63 billion in newly announced financing from banks and Blackstone to purchase Broadcom hardware, fueling the second-session rally that followed a Monday gain sparked partly by its S-1 filing.
- Broadcom would supply hardware funded by the $63 billion package, a structure Cramer criticized because Anthropic would borrow to buy the technology rather than pay with profits from its own business.
- CoreWeave rebounded almost 8% Tuesday even as Cramer cited bond yields that had reached as much as 15% and warned fresh negativity could emerge; he also singled out debt-burdened AI infrastructure companies Nebius and Iren.
- Federal Reserve was due to announce its latest interest-rate decision Wednesday afternoon, followed by Chairman Kevin Warsh's press conference, while the 10-year Treasury yield sat below 5% and oil prices declined.
- Nvidia was the exception to Cramer's claim that data-center companies lack substantial cash and must borrow, with elevated borrowing costs leaving returns uncertain despite his support for the AI build-out.
- Jim Cramer remained an unabashed believer in the AI build-out, but urged investors to look beyond tech and withheld an all-clear until the industry's financing challenges ease.
Why it matters: The $63 billion financing package gives large AI projects access to capital, while CoreWeave's bond yields reaching as much as 15% show the burden on smaller data-center companies dependent on borrowing. Wednesday's Federal Reserve decision, with the 10-year yield below 5%, is the next concrete test of their exposure to financing costs.
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