Even Friday’s massive market snapback couldn’t erase all of the week’s damage. After several days of selling, the tech sector rallied, with the Nasdaq up more than 2% on Friday. Chipmakers Nvidia and Broadcom led the way with gains of 7.8% and 7.2%, respectively. The S&P 500 index rose nearly 2% at one point. Despite gains in the second half of the week, both indexes recorded declines this week. The Nasdaq fell 1.8% and the S&P 500 fell 0.1%. The story is different for the Dow Jones Industrial Average, which benefited from a rotation from growth stocks in software and technology to value sectors such as financials and industrials. On Friday, the 30-stock benchmark rose more than 1,200 points to close at a record high of 50,115 points. The Dow ended the week up 2.5%. .IXIC .SPX,.DJI Mountain 2026-02-02 Nasdaq, S&P 500, Dow since February 2nd “It’s a strong Dow rally,” Jim Cramer said at Friday’s morning meeting, adding, “We have a lot of strong Dows (in our portfolio), so we feel pretty good.” Averages for all stocks except Amazon and Verizon rose on Friday. Of the 34 holdings in the trust’s portfolio, 11 are Dow stocks, including Apple, Home Depot, Microsoft and Honeywell. We will know by Monday whether Friday’s rally gains momentum. Until then, here are three key moments that moved the market last week. 1. Everyone was concerned about capital spending Wall Street saw hyperscalers holding back on AI trading because of their huge investments in emerging technologies. Alphabet and Amazon both announced significant increases in annual capital spending to build out data centers and AI products. However, investors reacted differently to this news. Google’s parent company reported an impressive fourth quarter late Wednesday and announced that spending in 2026 could more than double from a year ago. Investors embraced this surprising development. The stock fell 0.5% on Thursday, but it was still much better than the Nasdaq’s 1.5% decline on the same day. Amazon shares fell 5.5% on Friday after Thursday night’s results fell short of management’s current quarter profit expectations. Still, it was a solid quarter overall for the cloud computing and e-commerce giant. 2. Software stocks take a big hit, and so do the rest of the tech companies Software stocks tumbled earlier this week on concerns that AI will eat into the market share of traditional enterprise software-as-a-service (SaaS) companies. The selloff had been going on for months, but accelerated after Anthropic released new automation tools for legal services on Tuesday. As portfolio director Geoff Marks pointed out, AI is a threat to the sector. But this week’s plunge has disrupted both those directly under attack and those with staying power, including the best cybersecurity companies. AI should actually be a tailwind for these businesses. We took advantage of CrowdStrike’s stock price decline to increase our position. After all, demand for CrowdStrike’s cybersecurity products has never been higher. 3. Massive rotation led to a correction in some stocks The lack of love for technology meant money moved to other, often overlooked areas of the market. It also gave us the opportunity to make a profit and raise cash. For example, it cut Home Depot and Honeywell, two Dow stocks with double-digit gains in 2026. On Thursday, it posted big gains in DuPont stock for similar reasons. Last week, the stock price soared more than 6% as capital rotated into value, the name of such an industry economy. DuPont stock has risen more than 16% since the beginning of the year. We even got a chance to sell and strengthen one of our laggard stocks, Texas Roadhouse. On Monday, the company implemented its second reduction in restaurant inventory in 2026, which has increased 15% since the beginning of the year. This is not due to a slowdown in the company’s performance, but rather concerns about when beef inflation will eventually subside. (See here for a complete list of Jim Cramer Charitable Trust stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive trade alerts before Jim makes a trade. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in his charitable trust’s portfolio. If Jim talks about a stock on CNBC TV, he will issue a trade alert and then wait 72 hours before executing the trade. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
