CNBC’s Jim Cramer said Thursday that the resurgence of enterprise software determined the stock market story in the third quarter.
While major averages posted modest gains in the third quarter that ended Wednesday, there was much more movement behind the scenes as market leadership shifted. Software stocks rebounded sharply from an artificial intelligence-driven selloff, while semiconductor stocks cooled after a strong first-half rally. of iShares Enhanced Technology Software Sector ETF (IGV) increased 17% in the quarter, while IGV decreased 11%. iShares Semiconductor ETF (socks).
“Ultimately, I think the third quarter will be remembered as the moment when software rebounded and some great data center efforts succumbed to profit-taking,” the “Mad Money” host said.
sales force Shares rose 46% during the quarter as investors became more confident that AI was not a threat to the company’s business but could be an engine of growth. The company announced Claudeforce, which includes plugins available to customers. antropic Claudes access data stored in Salesforce to perform tasks such as drafting emails and updating records. Salesforce also had a strong quarter and took advantage of the drop in stock prices to buy back its own stock. Kramer said the stock could still rise.
he is also bullish microsoftup 37% during the quarter.
“Microsoft’s stock price rally is just beginning,” Cramer said, pointing to signs that strong demand for CoPilot is fueling Azure’s growth and that its data center investments are starting to pay off.
working day and Viva Concerns about AI disruption also eased, rising to 55% and 60%, respectively. Cybersecurity remains a bright spot; cloud strike 39% increase as increasingly powerful AI reinforces the importance of protecting businesses from new threats.
Meanwhile, some of the previous data center winners went cold. corning Despite the steep sell-off, which is down nearly 40%, Cramer views the decline as a profit-taking, saying, “If it goes down again, I’ll be happy to buy it back.” caterpillar The company also saw a 24% decline, but said this could be an opportunity as its engines are increasingly powering data centers.
But heading into the new quarter, Cramer’s biggest concern is whether the Federal Reserve will continue to raise interest rates. The Fed raised its benchmark interest rate by a quarter of a percentage point in September, putting pressure on interest-rate-sensitive stocks such as: home depot.
“My biggest concern right now is the impact of rising interest rates on the stock market,” Cramer said, adding that the upcoming earnings season should provide a clearer picture of how rising borrowing costs are affecting companies.
Cramer’s Charitable Trust, a portfolio managed by CNBC’s Investment Club, owns stakes in CRM, MSFT, and CRWD.
