Cramer says AI is fueling the 'reacceleration of tech' in the stock market

Published Tue, May 23 202311:51 AM EDT

Christopher Alessi @/in/christopher-alessi-78b9b09/@ChrisAAlessi

Every weekday the CNBC Investing Club with Jim Cramer holds a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Tuesday's key moments. 'Sitting in no-man's land ' Tech stocks to rise in AI Watch Eli Lilly 1. 'Sitting in no-man's land' Stocks edged down in directionless trading Tuesday morning after President Joe Biden and House Speaker Kevin McCarthy failed to reach a deal on raising the U.S. debt ceiling during negotiations the prior evening. The government could default on its debt obligations as early as June without an agreement. The market is "sitting in no-man's land," Jeff Marks, director of portfolio analysis at the Club, said Tuesday. Meanwhile, U.S. bond yields rose to their highest level since March, with that of the 10-year Treasury at 3.7%. Oil prices climbed more than 1%, with West Texas Intermediate crude trading around $73 a barrel, after Saudi Arabia's oil minister warned market speculators to "watch out." Jim Cramer said Tuesday that inflation and the Fed's fight against it are still in play. 2. Tech stocks to rise on AI Jefferies on Tuesday raised its price target on Club holding Microsoft (MSFT) to $400 per share, from $350, while maintaining a buy rating on the stock. The firm also upped its price target on fellow Club holding Alphabet (GOOGL) to $150 from $130 and kept its buy rating. The price target increases come as "AI companies are dominating" the stock market and leading the "reacceleration of tech," Jim said. Those stocks have been boosted by big companies moving their infrastructure into the cloud to be able to take advantage of Big Tech's artificial intelligence capabilities. Jim added that Club name Nvidia (NVDA), which reports first-quarter results after the bell Wednesday, still remains the semiconductor firm to own for its AI prowess. Stifel on Tuesday raised its price target on Nvidia to $300 from $225 and kept its neutral rating. 3. Watch Eli Lilly TD Cowen on Tuesday raised its price target on Club holding Eli Lilly (LLY) to $500 per share from $340, while maintaining its equivalent of a buy rating on the stock. On Monday, we sold 50 shares of Eli Lilly, at $442 apiece, to take advantage of the stock soaring to a new all-time high . We're still bullish long-term on this leading pharmaceuticals firm but recognize the need to prudently trim winners sometimes to raise cash. Eli Lilly stock was down 1.85% in midmorning trading, at just under $426 a share. (Jim Cramer's Charitable Trust is long GOOGL, MSFT, NVDA, LLY. 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.