Aniket PujariEvery weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Market update: Stocks are getting hit Wednesday, putting the S & P 500 on pace to break its three-session win streak. Headlines around President Donald Trump preparing to announce tariffs on autos as soon as Wednesday may have caused the market’s losses to accelerate. The S & P 500 has made a nice move off its recent bottom on March 13, but there is still a high level of uneasiness and uncertainty ahead of Trump’s reciprocal tariffs expected on April 2. AI sell-off: Stocks tied to the buildout of artificial intelligence infrastructure are getting hit the hardest Wednesday on concerns about tariffs, other trade restrictions, and new environmental rules out of China that would prohibit the use of Nvidia’s H20 chips in data centers in favor of more energy-efficient technology. This could spell trouble for chip sales, but the bark is likely worse than the bite because Nvidia’s chips have the highest compute power and are best equipped to handle the most demanding workloads. The impact of the rules also is unclear, based on the Financial Times story that first publicized their existence. The article indicated the rules were introduced last year, but to date have not been strictly enforced. The market remains hypersensitive to concerns about an oversupply of data centers. The group, which extends beyond chip makers to industrial companies like Club name Eaton and Vertiv , trades volatilely on every data point — both good and bad. On Tuesday, Alibaba Chairman Joe Tsai warned about a potential bubble in the AI infrastructure buildout. Our pushback has been that Nvidia CEO Jensen Huang has said new reasoning models like DeepSeek’s RI consume 100 times more compute than non-reasoning AI models such as those that first underpinned early versions of ChatGPT. But that hasn’t stopped fears of oversupply. A new analyst report from TD Cowen on data centers said portfolio holding Microsoft has once again canceled plans for new projects in the U.S. and Europe. It’s a similar story from the same analyst who raised flags in late February about Microsoft pulling back its data center footprint. At the time, a Microsoft spokesperson told CNBC the company’s plan to spend over $80 billion on infrastructure this fiscal year was on track. This latest report may be stoking fears about oversupply and excess capacity, but the note mentions Club names Alphabet and Meta Platforms took on some of the leases and capacity. Our takeaway from this is that any cancellation by Microsoft may be related to its evolving relationship with OpenAI and not as much as an industry call as the market is making it out to be. As part of Project Stargate , OpenAI is establishing a closer relationship with Oracle for some of its computing needs. If the market was oversold, we would be more interested in buying some of the AI data center buildout stocks like Broadcom or Eaton . However, the S & P Short Range Oscillator was a plus 1.92% after Tuesday’s session, meaning the market was closer to overbought territory (plus 4% and higher) than oversold (minus 4% and lower.) The S & P Oscillator is our trusted momentum indicator that helps guide our decision to put money to work, or take some off the table when rallies look extended. Up next: The key earnings report after the closing bell Wednesday is Jefferies Financial Group . The investment bank’s results and commentary will provide a look at the state of mergers-and-acquisition activity, as well as other capital markets action. That is all relevant for Club name Goldman Sachs . It’s no secret that the rebound in M & A activity we expected at the start of the year has failed to materialize, but trading volumes have been strong. With the first major initial public offering of the year coming later this week from CoreWeave, we will soon see if the market has an appetite for new listings, which could lead to more companies going public. On the data side Thursday, we’ll see the final read on fourth-quarter GDP and weekly jobless claims. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) 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.
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street.
