AI stocks tumble as the defensives rise. What it says about this uneasy market

Every weekday, the CNBC Investing Club with Jim Cramer holds a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Thursday's key moments. 1. Stocks are lower Thursday as another wave of selling washes over the artificial intelligence trade. Likely behind some of the selling was Nvidia CEO Jensen Huang telling CNBC that there is a "scarcity of capital" for neoclouds like CoreWeave , even though compute demand is "off the charts." Meta Platforms ' comments on its AI funding needs could be another factor. And, chipmaking equipment provider Lam Research 's disappointing guidance for the current quarter is also weighing on the semiconductor cohort. Portfolio director Jeff Marks noted that Micron , Intel and Qnity are all lower. GE Vernova , whose gas turbines are integral to the AI buildout, is down almost 10%. It was just a day ago that SpaceX 's bullish comments on AI demand and supply constraints lifted GE Vernova and other data center names. The market has "no memory from one day to the next," Jeff said. 2. The flip side is there's a rotation into defensive pockets of the market, with healthcare and consumer staples sitting as the best-performing sectors in the S & P 500 . Despite a rise in oil prices Thursday, bond yields are moving lower, reflecting a flight-to-safety trade. (Remember, bond buying that pushes bond prices higher moves bond yields lower due to their inverse relationship.) With an over 2% gain Thursday, Johnson & Johnson has erased all of its post-earnings sell-off. Kimberly-Clark is continuing its move higher and is back to about where we initiated the position on Sept. 2. That's making our buys into weakness on Sept. 18, Oct. 8 and Oct. 13 look good. Jeff noted that ex-Club name Procter & Gamble reported a solid quarter Thursday, but that's not causing any regret about choosing Kimberly-Clark within the consumer staples group. "Still like the [pending] Kenvue acquisition there," Jeff said. 3. Meta is having a rough session, down nearly 6%, despite reporting strong revenue growth Wednesday night and painting an upbeat picture on the opportunity for its Muse AI agent business. However, one notable takeaway from the quarter is that Meta is creating a new class of non-voting stock that is likely to be used to help finance its AI buildout. "Maybe that's the overhang," Jeff said. With Thursday's decline, Meta has erased most of its post-Muse bounce. It was launched Sept. 8. Jeff noted that we sold 35 shares of Meta on Sept. 22, believing the stock was having a parabolic move that necessitated a disciplined trim. "As the stock comes down and gives up all these Muse gains, maybe that will be interesting to change our rating and buy what we sold higher. Not there yet. We're going to be patient," Jeff said, noting our buys lately have been outside the tech cohort. (Jim Cramer's Charitable Trust is long MU, INTC, Q, GEV, META, JNJ, KMB and NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.