Microsoft, Google just told us AI is for real, right now. Here's a broad selection of stocks that will benefit

Published Wed, Apr 26 202312:05 PM EDT

My advice right now: Listen to what the market's telling you. It's not lying. It's saying that enterprise software — the blast zone of last year — is coming roaring back because artificial intelligence requires all new programs to work. Yes, it is that big a deal. Some will look back at this moment and say what mattered was the troubles at First Republic (FRC), which may not survive the mini-banking crisis, and how it is overshadowing everything. (I've said it over and over if First Republic were to collapse it would not be a systemic industrywide problem.) Others will look back and say this was the quarter when you saw genuine weakness in the core of both America and Europe — the basic engine of employment finally slowing down. Me? I will look at it as when we were told by Microsoft (MSFT) and Google-parent Alphabet (GOOGL), both Club stocks, not that artificial intelligence is coming but that they are using it, offering it, and recognizing that it is turning their businesses that have been somewhat slowing in growth into growth engines once again. Now some of this AI boom is because of Club name Nvidia (NVDA), which was mentioned on both post-earnings calls as being the power behind artificial intelligence. AI inflected this quarter, I believe, not just because of ChatGPT, the viral brainchild of Microsoft-backed OpenAI, but because Nvidia's cards were so fast that there are now whole new applications that can work that were seen as unfeasible before. Alphabet made the point that its cloud business, which just turned profitable, is built on Nvidia chips, the only cloud provider, they say that runs on them. But most of it is because artificial intelligence now is so meaningful that big customers have come into them saying what can we do, how can we use it? How do we know this? When I say listen to what the market is telling you, I like to look at stocks that have no news but are ramping anyway. Enterprise software stocks are doing that Wednesday. The thinly traded ones — MongoDB and DataDog , both up double digits — or the biggest in the industry, Club stock Salesforce (CRM), aren't rolling higher because of anything they said. They are rising because they are considered integral to the writing of the new programs to take advantage of changes that will make operations better. This move in these stocks could turn into a change in mindset about these stocks because AI may mean an acceleration of laggard tech, including personal computers (PCs) and servers. It may be the spur that's needed. Nvidia and fellow semiconductor company Advanced Micro Devices (AMD) are both up big in Wednesday's trading. I know Google is not blitzing higher but not bad with a 1.5% gain. Ruth Porat, the powerful Alphabet CFO, came out with some boilerplate, world uncertainty caution. I get that. Despite the endless obsession with trying to sound like Microsoft when it comes to AI — mentioned like 50 times on the call. I understand that the new AI-power Bing search engine from Microsoft could undermine a core Google franchise that enjoys a near monopoly in the space. Google has responded to Microsoft's AI push with its own called Bard. Bottom line When you see the ancillary plays running and can't find a reason, that's because the smartest people are recognizing this isn't business as usual and it's time to buy everyone in enterprise software. Does that make us want to buy MongoDB or DataDog? I think it's enough that we own Salesforce, Alphabet and Microsoft. No need to go down further on the food chain for the Club. But when you see Azure, Microsoft's web services business, outperform; when you see Google's cloud business inflect positively after several years of losses, this isn't the time to sell, it's the time to buy. (Jim Cramer's Charitable Trust is long MSFT, GOOGL, NVDA, CRM, AMD. 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. 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.

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My advice right now: Listen to what the market's telling you.