Uncover Monday's Market Movements with Jim Cramer

Wall Street's Weekly Performance

Starting the week, Wall Street is on an upward trajectory after experiencing significant losses last week. The S & P 500 shed more than 2% and the Nasdaq lost more than 3%. The market is still navigating through some uncertainty surrounding President-elect Donald Trump's cabinet appointments. Jim Cramer emphasized to investors the importance of "staying the course" and avoiding the temptation to make short-term trades based on political headlines.

He echoed his Sunday column for Club members, advising investors to steer clear of "excitement stocks that have had parabolic moves" in anticipation of Trump's return to the White House next year. This shows Jim's focus on long-term investment strategies rather than being swayed by short-term market fluctuations.

Nvidia's Monday Dip

Nvidia dipped nearly 2% on Monday following a report by tech publication The Information. The report stated that its next-generation Blackwell AI chips faced overheating issues when integrated into large server systems. Although Jim expressed some reservations about Nvidia ahead of its earnings report on Wednesday night, he is not overly concerned about the long-term implications of these heat challenges.

He pointed to a social-media post from Dell CEO Michael Dell on Sunday, where Dell said the company is now shipping Blackwell server racks. This raised questions among investors, with Jim rhetorically asking, "Why is he shipping defective racks? He's not." When asked for comment on the The Information report, an Nvidia spokesperson emailed a statement to the Investing Club, stating that NVIDIA GB200 systems are the most advanced computers ever created and that integrating them requires co-engineering with customers. The engineering iterations are normal and expected.

Advanced Micro Devices' Surge

The Nvidia report may be having an impact on the semiconductor sector and contributing to the more-than-3% increase in shares of Advanced Micro Devices. Some investors may believe that any issues with Blackwell could lead to more AMD chip sales. However, Jim cautioned that this is not a valid reason to rush out and buy AMD stock on Monday.

On the other hand, AMD's new partnership with IBM is a more compelling reason to be interested in the stock. IBM announced that AMD's MI300X AI chip will be available on IBM Cloud in the first half of 2025. AMD, which is a distant second to Nvidia in AI chips, is also partnered with Microsoft and Meta. Jim expressed his desire to add to our AMD position but acknowledged that buying into strength like we're seeing on Monday is not in line with our investing playbook. Our preference is to buy on weakness. He believes that announcements of additional AI chip deals with tech giants like Amazon could fuel further gains for the stock.

Stocks Covered in the Video

Stocks covered in Monday's rapid fire at the end of the video included CVS Health, Netflix, Robinhood, and Warner Bros Discovery. (Jim Cramer's Charitable Trust is long NVDA, AMD, AMZN, MSFT and META. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. He waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If he has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade.

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