Jim Cramer likens AI stock sell-off to 1987 Black Monday crash

AICNBC's Jim Cramer says it is too soon to buy back into the hardest-hit AI data center stocks despite Monday's tech rebound, in which the Nasdaq Composite rose about 1.1%. He names four conditions to watch: the charts improving, hyperscaler earnings including SpaceX and Meta this week, the November 3 midterm elections, and a successful Anthropic IPO that could come as soon as November.

AIThe Nasdaq rose Monday as investors rotated back into chip stocks after fears about the sustainability of the AI boom fueled last week's selloff. Investors are awaiting Wednesday's Meta earnings report, and the market volatility has delayed several tech IPOs this year, possibly excluding Anthropic's.

AICNBC's Jim Cramer says the recent AI stock sell-off echoes 1987's Black Monday, when stocks fell despite strong underlying companies. He says semiconductor and data center stocks fell together last week without apparent deterioration in company fundamentals, and he suspects a hedge fund liquidation intensified Friday's drop, though Cramer notes that liquidation has not been confirmed. He advises investors to distinguish stocks falling because their businesses are weakening from those falling due to forces beyond company control.