Jim Cramer explains why the Magnificent Seven have lasting strength in the market
CNBC's Jim Cramer on Monday opined on the continuous success of Big Tech stocks in the market, explaining why the Magnificent Seven, as well as Netflix , continue to rally as the bull market persists.
"Even if you've missed these rebounds in the Magnificent Seven plus Netflix, don't, don't sweat the program," he said. "We know these stocks will once again be hit by endless worries, giving you more opportunities to buy."
The Magnificent Seven includes Amazon , Alphabet , Apple , Microsoft , Nvidia , Meta and Tesla , and many of these stocks have seen declines in recent months followed by strong rebounds.
First, Cramer addressed two of his favorite stocks ? which he repeatedly insists investors should own, not trade ? artificial intelligence powerhouse Nvidia and iPhone maker Apple. It's difficult to sell and then buy back shares of these two before a rally begins, he said. Cramer noted that demand for Nvidia's advanced graphics chips remains strong. He also said that many analysts who criticize Apple don't take into account the company's history of success, and he suggested concerns about business in China may be overblown if the government's stimulus plan works.
However, Cramer said he doesn't feel as strongly about Alphabet, in part because of ongoing antitrust litigation and the threat of a breakup. However, he still called the stock a "comeback kid." He praised Amazon's web services business and said Meta is "off to the races again," fired up by its strong advertising arm. He addressed rumors about weakened demand for Microsoft's AI assistant but said there needs to be stronger evidence of such issues to send the stock down.
And despite Tesla's robotaxi flop, Cramer said it's unwise to short the stock and bet against CEO Elon Musk. And Netflix, he said, hasn't begun to monetize its new ad tier, and he predicted management will impress investors with a positive future outlook.
This tech rally may be different than previous ones, Cramer suggested, as it leaves room for other stocks to see gains as well. He noted that there's more money flowing into the market since the Federal Reserve began its rate-cutting cycle, making it easier for other sectors' shares to climb.
"Unlike previous Mag 7 rallies, this one's definitely not a zero-sum equation where the rest of the market does nothing," he said. "Other groups can roar, too, in this market, perhaps because there's just a lot of money going around."
