{"id":12229,"date":"2026-01-14T12:00:37","date_gmt":"2026-01-14T12:00:37","guid":{"rendered":"https:\/\/microvibenews.com\/?p=12229"},"modified":"2026-01-14T12:00:37","modified_gmt":"2026-01-14T12:00:37","slug":"stocks-the-magnificent-7-are-dying-and-wall-street-is-pretty-happy-about-it","status":"publish","type":"post","link":"https:\/\/microvibenews.com\/?p=12229","title":{"rendered":"Stocks: The \u2018Magnificent 7\u2019 are dying, and Wall Street is pretty happy about it"},"content":{"rendered":"

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The S&P 500 fell 0.19% yesterday but, interestingly, the \u201cequal weight\u201d S&P 500 (a notional index that values each stock equally) was marginally up. That\u2019s because more investors are picking between winners and losers on the index\u2014and many of the losers are the \u201cMagnificent Seven\u201d tech stocks.<\/p>\n

The market as a whole is up 0.48% year-to-date. Given that the year is only a few days old, that pace promises healthy gains ahead.<\/p>\n

But only two of the Mag 7 stocks are in positive territory so far, Alphabet and Amazon. All the others are down. Some of them are down bad<\/em>. Tesla has lost 4.73% so far, Apple is down 4.83%.<\/p>\n

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The collapse of the Mag 7 is important because in the last few years the valuation of those stocks has grown so big that they now form more 30% of the value of the S&P as a whole. It created a situation where even if you bought an S&P 500 exchange-traded fund your results were mostly affected by the Mag 7.<\/p>\n

To give you an idea of how worried analysts are about this concentration risk, Apollo Global Management chief economist Torsten Sl\u00f8k recently published a note whose opening page looked like this:<\/p>\n

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\"\"<\/div>\n<\/figure>\n

But the dominance of the Mag 7 is likely to come to an end this year, many on Wall Street believe\u2014if only because their valuations can\u2019t exponentially go up forever.\u00a0<\/p>\n

Morgan Stanley Wealth Management Chief Investment Officer Lisa Shalett believes the market is undergoing a healthy rotation away from tech stocks and back into the non-tech components of the S&P.<\/p>\n

\u201cWe see several drivers of healthy deconcentration of the current \u2018top 10\u2019 components persisting,\u201d she said in a recent note. \u201cFirst is relative earnings acceleration. Growth rates are apt to continue to decline for the \u2018Magnificent Seven\u2019 while those of \u2018the 493\u2019 improve. Second, stock-buyback activity among the tech giants is falling as operating cash flow increasingly goes to [AI-related] capex.\u201d\u00a0<\/p>\n

The result is something that traders are pretty happy about because\u2014as yesterday\u2019s equal weight S&P performance shows\u2014the other 493 stocks are still able to generate gains even if the Mag 7 are crumbling.<\/p>\n

\u201cOn a [year-to-date] basis, the bull market in the S&P 500 is broadening, as we expected it might this year. The S&P 400 and S&P 600 are outperforming the S&P 500,\u201d Ed Yardeni of Yardeni Research told clients this morning:<\/p>\n

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The Mag 7 has been in decline for two and a half months. \u201cThe Impressive-493 has outperformed the Magnificent-7 since last November. We expect this will continue in 2026, as last year\u2019s LargeCap laggards catch up,\u201d Yardeni said.<\/p>\n

Here\u2019s a snapshot of the markets ahead of the opening bell in New York this morning:<\/strong><\/p>\n

    \n
  • S&P 500<\/strong> futures were down 0.44% this morning. The last session closed down 0.19%.<\/li>\n
  • STOXX Europe 600<\/strong> was up 0.27% in early trading.<\/li>\n
  • The U.K.\u2019s FTSE 100<\/strong> was up o.3% in early trading.\u00a0<\/strong><\/li>\n
  • Japan\u2019s Nikkei 225<\/strong> was up 1.48%.<\/li>\n
  • China\u2019s CSI 300<\/strong> was down o.4%.\u00a0<\/strong><\/li>\n
  • The South Korea KOSPI <\/strong>was up 0.65%.\u00a0<\/strong><\/li>\n
  • India\u2019s NIFTY 50<\/strong> was down 0.26%.\u00a0<\/strong><\/li>\n
  • Bitcoin<\/strong> was at $95K.<\/li>\n<\/ul>\n<\/div>\n
    \n
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    #Stocks #Magnificent #dying #Wall #Street #pretty #happy<\/p>\n","protected":false},"excerpt":{"rendered":"

    The S&P 500 fell 0.19% yes… <\/p>\n","protected":false},"author":1,"featured_media":939,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[445,8753,8754,3706,3705,166,8660,91,221,891,853,890],"_links":{"self":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts\/12229"}],"collection":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12229"}],"version-history":[{"count":0,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/posts\/12229\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=\/wp\/v2\/media\/939"}],"wp:attachment":[{"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12229"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12229"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/microvibenews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12229"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}