Fed Rate Decision Eve, Market Records Watch, Intel's AI Boost 9/17/24

David Faber (0:00)

Market Insight and Analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:05)

Good Tuesday morning. welcome to Squawk on the Street. I'm Carl Quintanilla with David Faber at Post 9 of the New York Stock Exchange. Cramer is at One Market in San francisco. Dreamforce kicks off today. S&P looks to take aim at some record highs at the open, following the Dow's all-time high yesterday. Retail sales solid. Fed meeting begins. Plenty of Mag-7 news from Microsoft to Meta to Amazon. Our roadmap begins with the Fed decision, though, just a day away as the Street debates how deep of a cut to expect.

David Faber (0:32)

On the tech front, shares of Intel are up sharply, at least in the pre-market. Lots of developments surrounding the company, including its agreement to produce AI chips for Amazon Web Services. Plus, Microsoft announces a dividend hike, authorizes a new stock repurchase. It's up to $60 billion in potential buybacks.

Carl Quintanilla (0:51)

Let's start, though, with the markets. S&P is riding a six-day wind streak ahead of the Fed's decision tomorrow. Well, Jim, and futures here look a little spicy.

Jim Cramer (1:00)

Right. Now, we know that the industrials have had a little bit of run. The banks have been okay. Healthcare is all right. These were all the today and Friday. But this look, and yesterday, but this looks like today. We're already setting up, maybe it's perhaps because of the Microsoft buyback, a very good tone as we remember that these companies have a lot of power and have a lot of money. David, when you see a usual dividend boost, but a gigantic buyback, don't you think, well, wait a second, they can buy back 60 billion, isn't that bigger than most companies? That kind of thing does create a level of confidence.

David Faber (1:34)

Yeah, the buyback 60 billion, not to mention what their cap X spend is, and only going higher, where are we? In the 50 billion plus, at least. Now, listen, the numbers are extraordinary. I pointed out, I'm like a broken record around earnings every time because I'm just so wowed by just the numbers themselves, Jim. But we make the point, and I think it is worth making. These companies, the enormity of their balance sheets, the enormity of their capital structures, of their broad power, so to speak, despite the fact that they may not be violating any anti-monopoly laws is extraordinary. And really unlike anything I think we've ever seen at least in our lifetime.

Jim Cramer (2:13)

Yes. And look, take a look at Alphabet, okay? Now, I'm seeing Waymo cars all over San francisco. We know that they've got deals to do other cities. And yet, what are we hearing? That they've been a monopolist when it comes to advertising. You know, Carl, some companies are so powerful and their tentacles are everywhere, that Alphabet stock trades below market mobile because people worry about the government. I think these companies are in the crosshairs of the government because what can you do? They're just bigger than countries. And you can't take them on if you're in their bailiwick.

Carl Quintanilla (2:46)

Speaking of autonomous driving, Jim, I know you saw this Bernstein note today, where they argue if it hadn't been for Gen.i, we might be talking about this year as the year autonomous driving turned a corner, when you got Waymo rides going to Exa in a short period of time, Cruze is testing again. We talked about the Uber expansion to Atlanta the other day.

Jim Cramer (3:07)

Look, when I think about what's going on in San francisco and then these other cities, I begin to see the possibility, I'm going to see this today when I'm at Dreamforce, which is Salesforce's wonderful extravaganza for AI. Really, the cars and buses that don't have steering wheels and that's the future. They just look like little mini buses. Then David, you don't have this oddity of someone not behind the wheel so you feel like, well, wait a second, where's the driver? That's over and I'm seeing these as being the next step when it comes to drivers.

David Faber (3:40)

Yeah. It's an interesting and a long piece from your good friend, I think it's Tony Saganagi, isn't it Carl? So I know you're going to read that with great interest. Of course, Tesla, we pointed out many times has been a big beneficiary as well in terms of how it's training itself, driving in terms of generative AI and the advances potentially being made there as well. We talked obviously to Derek Oswalt-Shahi last week about Austin being one of their key markets as they partner with Waymo. We'll keep an eye on both of those shares.