Tech companies’ earnings will shape markets in coming months Jim Cramer

This week’s earnings of major tech mega-cap stocks, viz. Amazon, alphabet, apple, microsoft and Meta – will be critical to market performance in the coming months, CNBC’s Jim Cramer said Monday.

“We know that the direction of the market over the coming months will be determined by the results we get this week,” he said. “If we lose these companies, we can’t make sustainable progress. There’s nothing to make up for them. Yes, the stakes are really high.”

These stocks and their peers in the Magnificent Seven Nvidia and teslaaccounting for almost 35%. S&P500said Kramer. He further added, “Because of the breadth of their products, these companies represent the best we have in this country and the world,” and said you can make a claim to owning any of these companies regardless of their earnings this week.

He looked at what he expects from these major companies, starting with Alphabet, Microsoft and Meta, which are scheduled to report on Wednesday. He noted that while all three companies are technology-related names, their businesses span multiple sectors.

Mr. Kramer has indicated he is interested in Google’s lucrative advertising business, particularly its YouTube and search divisions. But to Wall Street, Google’s most important area is its cloud business, which has been “strong” lately, he added. Kramer also mentioned the company’s investments in nuclear power and quantum computing ventures.

Cramer suggested that metas should share metrics such as daily user numbers and average revenue per person across platforms. He also said he would like to hear from Mr. Zuckerberg, who is both hilarious and tough, talking about his “competitive advantage in AI and power,” his strengths in the advertising business, and a good update on artificial intelligence glasses.

Kramer said Microsoft is in a “tough spot” because it has “basically become a corporate monopolist.” He said he is concerned about the growth of the company’s Azure business, adding that he would like to hear positive comments from the company’s CFO, Amy Hood.

Amazon and Apple are scheduled to release their reports on Thursday, and Cramer said the most important aspect of the former’s quarter was its web services division. He said he would like to know that Amazon is working with Nvidia to develop new chips that will help AWS win new customers, adding that he hopes the company’s massive outage won’t cause too much damage.

Cramer said he was concerned about the reputation of Apple’s new iPhone 17, and said the stock could rise if sales accelerate in China and the United States. He also said he hopes other hyperscalers will pay Apple to make it their default AI system. This is similar to the deal Apple currently has with Alphabet to make Google its preferred search engine.

“When you own a stock with a market capitalization greater than a country’s GDP, you can’t ignore it,” Cramer said.

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Disclaimer CNBC Investing Club owns stock in Amazon, Apple, Nvidia, Meta, and Microsoft.