Squawk on the Street 10/19/26

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Carl Quintanilla (1:00)

Market moving insight and analysis join Jim Cramer, David Faber and me, Carl Quintanilla on the opening bell hour of CNBC Squawk on the Street. Good Monday morning.

David Faber (1:09)

Welcome to Squawk on the Street. I'm David Faber with Jim Cramer. We are at post nine of the New York Stock Exchange. Carl has the morning off. Let's give you a look at futures as we get ready to start the trading week. One and a half hour from now, we are set up for a higher open, in particular, the NASDAQ and some of those names that were beaten down last week, and that is where our roadmap begins. Bit of a tech turnaround, AI-related names rallying in the pre-market. That does follow significant losses, fairly significant, at least on Friday, for example, and Wednesday. Plus Anthropic and Elon Musk, both pledging separate public donations in a sense. We'll give you details there. And JP Morgan upgrades one major chip stock, saying their confidence is building in that name, and those shares also higher in the pre-market.

Jim Cramer (1:56)

Just cover your short there, huh, Pat Morton?

David Faber (1:59)

Yeah. All right, let's get right to the markets following one of the worst weeks for the S&P and the Nanotech, at least since June.

CoreWeave shares, which we focused on a lot last week, are rebounding. It was down more than 20% last week, and it's not alone. It leads that pack, but Dell shares, it's funny, I talked to Michael on, what was it, on Tuesday, and that stock just went down significantly because of concerns, Jim. Of course, not about financing for data centers. It's not in that business, but it is in the business of putting stuff in those data centers. And so if there are fewer of them getting built, well, there might be less demand for that. And on from there, HPE, of course, same business.

What's the setup this week?

Jim Cramer (2:42)

Well, I think that we've been very linked to the Cospi. We've been very linked to Samsung, the SK Hynix. SK Hynix up last night, that really helped the group.

There's a little knee-jerk analysis there.

I think that we're all in a situation where we're worried about whether there's going to be overbuilding of data centers, meaning that the SPAC guys, the nebiuses come forward, the irans come forward and they keep building, versus the idea that if CoreWeave is running out of capital, can't buy any capital because rates are up, those guys are really in trouble. I come back and say that there's tremendous demand and there's also an inability to build. CoreWeave knows how to build. I think we're forgetting the fact that not all builders are equal. The reason why CoreWeave has been able to get such a break is that everybody trusts how they build. I think Elon Musk does, but the fact is Elon Musk yikes last week. The yikes that he said on October 13th in reaction to the bonds.

David Faber (3:53)

To the bonds. The unsecured bonds of CoreWeave during the course of last week traded at a yield as high as 15%.

Now, they're only about 20% of their overall debt stack is that unsecured. But it did point to the cost of capital. But I will come back to you and say, all right, Jim, but it's not as though the potentially higher cost of capital or the ability to get it is not going to continue to be an issue going forward. We haven't dealt with this and said, okay, that's done.

Jim Cramer (4:20)

We care more about power.

We know that Microsoft is big. They're a very big in-trader house. They're a very big CoreWeave. Microsoft is going to continue to build this. Who's going to continue to build? Do you know what I think may determine the earnings that we're about to get, and the commitments to CapEx, and the notion of whether this stuff can be built or not?