Dow futures trends lower Thursday as record COVID cases hit India, reported state of emergency orders have been issued in Tokyo and there's been a slowing pace of vaccinations in the United States.
In the last episode of Mad Money, Jim Cramer said the FAANG stocks get the benefit of the doubt, and they deserve it.
TheStreet's Katherine Ross and Cramer are talking about Apple's "Spring Loaded" event, semiconductor equipment maker ASML Holding and back-to-back selloffs in the market.
Apple: Buy Or Sell?
Apple unveiled new models of iMac and iPad Pro on Tuesday during "Spring Loaded," its first product-reveal event of the year.
Cramer said for the first time we're seeing Apple PCs and Macs perhaps having an impact on earnings. "Goldman Sachs says they will. I do believe very strongly that there is going to be an impact," he added.
On Wednesday ASML Holding (ASML) - Get Report reported stronger-than-expected earnings as the semiconductor equipment maker boosted its full-year profit forecast based on improving demand for its $120 million EUV lithography machines amid a global chip shortage.
Cramer said ASML makes gigantic machines that are integral to creating memory chips and logic chips. "Any chip that is lower level runs through ASML. They thought [demand for] memory [chips] will be up a little, it turned out to be a lot. They thought [demand for] logic [chips] would be up a little but turned out to be a lot," he said.
He added ASML is really at the heart of the chip shortage."They just can't make enough... When you look at the breakdown of South Korea, Taiwan and China that's who is buying their machines, we only represent 3% of the machines that they sell. And that's why we're in so much trouble. We're no longer a producer of the semis," he said.
Cramer said when you have back-to-back selloffs and the SPACs [Special Purpose Acquisition Company] have obliterated you and the stocks that are selling are the ones at a high multiple to sales and the cruise ships and the end of the GameStop (GME) - Get Report phenomenon. "What you end up with is a group of people very dissatisfied with the stock market because it no longer just goes up," he added.