Cramer tempted to buy chipmaker, sells hyperscaler on Deepseek Sell-off
Every weekday, the CNBC Investment Club with Jim Cramer hosts a livestream “morning session” at 10:20 a.m. ET. Here’s a recap of Monday’s highlights. 1. Stocks were crowded on Monday as Chinese startup Deepseek’s lower-cost AI model sent shockwaves through the tech sector. Semiconductor stocks led the decline with NVIDIA and Broadcom down 13%. Investors fear that hyperscalers may overspend on AI, as DeepSeek seems to show that you may be able to build competitive language models without using expensive chips. Jim Cramer said the latest news leaves more questions than answers. “I don’t think we can necessarily conclude what to do.” 2. Jim sees a potential opportunity in Chip Stock Broadcom. “If there had to be an acquisition, it would really be Broadcom … it’s bigger than just AI.” He predicts it’s the name the market may rally around instead of Nvidia, as the company’s portfolio also includes networking solutions and infrastructure software. We recently trimmed our position on December 17th after the stock went parabolic following its Q4 earnings. In the meantime, Meta is on our radar for coatings. With the stock up 12% for the start of 2025 and up more than 65% in the past year, Jim warned that it is “too high relative to the rest of the MAG 7 stocks,” adding that the tech giant could be overspending on building AI. Meta announced on Friday that it plans to increase AI-related spending to up to $65 billion this year. 3. Salesforce sold off sales with shares up 2.4%. Jim called the company a “beneficiary” of all concerns about Deepseek. CEO Marc Benioff sees the value of AI in building software, not hardware. Apple is also holding its ground, with the stock up 2.5%. The iPhone maker doesn’t invest billions of dollars in big language models, but instead integrates technology from other companies like OpenAi’s Chatgpt into its devices. (Jim Cramer’s charitable trust is debt NVDA, AVGO, Meta, CRM. See here for a complete list of stocks.) As a subscriber to CNBC’s 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 stocks in his charitable trust’s portfolio. If Jim discussed a stock on CNBC TV, he waits 72 hours after the trade alert is issued before he executes the trade. The above investment club information is subject to our terms and conditions and privacy policy, together with our disclaimer. No fiduciary duty or duty exists or is created by the receipt of any information specified in connection with the Investment Club. No specific outcome or profit is guaranteed.