Cramer's Morning Take: Big Tech 7/17/23

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Jim Cramer (0:33)

Jim Cramer here to share with you a sample of my take on the market from today's CNBC Investing Club morning meeting.

I put out a piece last night that I do want you to know. It came out late, but it talked about the notion of the bears being wrong, but it also addressed the Magnificent Seven and why they're light. At the same time, Jeff, I've got to comment. This NASDAQ special rebalancing and also kind of an ennui, the endless reiteration for Apple, the Magnificent Seven, Apple, Microsoft, for Google, for Amazon, for NVIDIA, for Meta, for Tesla, is beginning to, I think, cause people to rethink and maybe they're moving to other enterprise software like the ServiceNow. And a lot of what happened, I keyed off of the critical reversal on Friday of NVIDIA that really took my breath away.

Jeff Marks (1:22)

Yeah, some ugly late trading in those stocks. We do have the special rebalance that will go into effect this Friday.

When that announcement first happened, we did see some sell-offs in the Magnificent 7, those largest seven stocks in the NASDAQ. They're gonna have their weight reduced to 44% from 56 So that money's gonna move around, perhaps going to other areas after you reference. So something to keep an eye on. I know Goldman's David Costin said, based off the last rebalance, limited impact in the affected stocks. And of course, these great balance sheets, great improving fundamentals as well this year, for many of them, especially second half of the year, I'm thinking about an AWS or an Azure.

Jim Cramer (2:05)

Right, people feel-

Jeff Marks (2:07)

That is advertising business. Reels get strengthening right now.

Jim Cramer (2:10)

And these are all regarded as being AI winners. And you see a lot of notes about how in the last quarter, AI is gonna come to be actually additive to them. That could be. Apple, by the way, I think is Vision Pro in India. I think both of those matter. Longer term, not short term.

But what I'm saying is that you're gonna see a Salesforce to a service now. The other enterprise software companies are going to take up the 40% of the NASDAQ that is tech. So you lower these, but you don't take tech from 40 to 35 You keep tech at 40 and you boost others in tech. And that's why things happen.

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