Cramer Sees Echoes of Dot-Com Bust as Wall Street Flees AI Stocks for Safety
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Jim Cramer says Wall Street is rotating out of AI infrastructure names into defensive stocks like Coca‑Cola and Walmart, comparing it to the 2000 dot‑com unwind; Alphabet fell nearly 7% after lifting 2026 capex guidance to $195–205 billion from $180–190 billion, turning quarterly free cash flow negative. Memory chip leaders including SK Hynix, Micron and Samsung have reversed gains as South Korea’s KOSPI sank over 10% this week, a pullback that could create broader risk‑off flows and impact crypto and DeFi liquidity and adoption ahead of the Federal Reserve decision and upcoming earnings tests.
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In Brief
- Jim Cramer compared the AI stock rotation to the 2000 dot-com bust.
- Investors dumped data center names for Coca-Cola, Walmart, and Costco.
- Alphabet lost billions in value after raising its 2026 capex guidance.
Jim Cramer told CNBC viewers Wall Street is fleeing this year’s hottest AI stocks. He says investors are moving into names like Coca-Cola and Walmart, a shift he compares to 2000’s dot-com unwind.
The Mad Money host points to swings in memory chip stocks. He also cites Alphabet’s stumble after it raised AI spending guidance.
AI Infrastructure Stocks Face a Reckoning
Alphabet’s stock fell nearly 7% after the company lifted its 2026 capital spending guidance. The new range is $195 billion to $205 billion, up from $180 billion to $190 billion. That increase pushed quarterly free cash flow negative, a rare result for the company.
Memory chipmakers have swung even harder. SK Hynix and its US peers, Micron, Western Digital, and SanDisk, surged through much of 2026. AI data center demand created severe shortages and gave these companies pricing power.
However, those gains have reversed sharply as the rally has matured. Cramer has lived through several boom-bust cycles in this group. He expects stocks to fall before the underlying business slows.
The pullback has hit Asian markets hardest. South Korea’s KOSPI sank more than 10% this week. SK Hynix and Samsung Electronics dropped alongside their US peers. AI supply chain problems are driving the broader bear market.
Cramer Calls It a Broadening, Not a Breakdown
However, Cramer describes the shift more as simple profit-taking. Institutions are selling AI infrastructure winners and buying companies with growth drivers away from the data center.
“You can call it a broadening. Or you can call it fleeing.”Jim Cramer
The pattern showed up directly in the tape. Coca-Cola, PepsiCo, and Walmart all rallied. The Dow Jones Industrial Average climbed while the Nasdaq Composite lagged behind. Hedge fund manager Steve Eisman has separately flagged this divergence. He warns the market now trades as a single AI bet.
Cramer stopped short of predicting a crash. He remains bullish on Nvidia and Intel and argues durable demand, not temporary chip shortages, supports both stocks. Cramer says he raised the dot-com comparison to flag a resemblance, not to forecast one.
The timing is sensitive. Seagate beat earnings estimates after Tuesday’s close. The Federal Reserve announces its rate decision today. Both events will test the data center trade. Investors will soon see whether it steadies, or whether money keeps flowing toward the stocks Cramer calls boring on purpose.
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