2 things capping Monday’s market. Plus, Alphabet’s new AI chip plans
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks moved slightly lower on Monday afternoon, as an initial S & P 500 rally failed to hold. While the market debated whether the recent correction in AI stocks had gone too far or if volatility would continue, oil prices and rising bond yields remained headwinds for equities. WTI crude traded above $83 per barrel during the session after briefly dipping to roughly $80 earlier Monday. Treasury yields continued their recent advance, with the 10-year climbing back to around 4.6%. Federal Reserve interest rate-hike probabilities crept higher on the renewed threat of an uptick in inflation due to energy prices going up again. Alphabet shares rose on a report that its Google unit is developing a more efficient AI chip. The Information said Monday that the tech giant is working on a new server chip designed to make its Gemini AI models run more efficiently. The chips, called Frozen v2, aren’t expected to be deployed until 2028 and won’t replace its tensor processing units (TPUs), which are co-designed by fellow Club name Broadcom . But the Frozen chips could help Alphabet run its AI models more efficiently by generating more tokens per unit of power. Tokens are units of data processed by AI models. While still potentially years away from releasing this new chip, the Information story highlights Google’s leadership in developing its own chips, which are both cost-effective and reduce reliance on third-party accelerators like Nvidia . Alphabet’s recent loss of high-profile AI talent and the delay of its newest, most powerful AI model have raised some concerns about its AI efforts. But projects like Frozen v2 should help reassure investors that the company continues to invest in its long-term AI strategy to keep its edge. There are no major after-the-bell earnings . A busy slate of quarterly results is on tap before Tuesday’s opening bell, with reports from 3M, Danaher, Halliburton, Charles Schwab, General Motors, Novartis, and Northrop Grumman. The first earnings report of the week in the portfolio is Capital One , which is set for Tuesday evening. We see the release from the credit card giant as a chance to show investors that its $35 billion Discover deal was worth it. There are no major economic reports on Tuesday. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust, including GOOGL, NVDA, COF.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
