Stocks are hitting records despite surging yields. Cramer explains why
CNBC’s Jim Cramer said Nvidia, Microsoft and Meta are helping push stocks to records even as surging Treasury yields pressure much of the broader market.
TL;DR
- Jim Cramer identifies a disconnect between stock and bond markets, with AI giants masking pressure from rising Treasury yields.
- Despite multiyear high Treasury yields, the Nasdaq and S&P 500 reached record or near-record levels, driven by Meta, Microsoft, and Nvidia.
- These three companies have strong catalysts, such as Nvidia's AI chips, Microsoft's Copilot, and Meta's Muse app, driving investor interest.
- The significant market capitalization of these tech giants allows their gains to propel major indexes higher, even as other sectors suffer from higher rates.
- Cramer notes that traditional safety stocks and utilities are weakening, indicating that higher yields are impacting a significant portion of the market beneath the surface.
- He suggests that the bond market, with sellers proving astute, may offer a clearer indication of future market direction than the stock indexes.