Overview of the Seven Magnificent Tech Stocks
In the third quarter of the year, the collective surge in stocks of the Seven Magnificent tech companies added over $2.5 trillion in market capitalization.
Collectively, these seven high-capitalization technology stocks that form the index summed up to $2.756 trillion from July to September, according to Economática. This year, they have gained a total of $3.1 trillion.
Key Players and Their Contributions
NVIDIA, Microsoft, Apple, Alphabet (Google’s parent company), Amazon, Meta, and Tesla together are valued over $20 trillion, representing nearly a third of the S&P 500’s market capitalization.
- Alphabet: Led the increase in market capitalization with $797.61 billion, totaling $2.942 trillion.
- Apple: Added $714.425 billion, reaching a total of $3.778 trillion.
- NVIDIA: As an AI giant, contributed $678.938 billion, totaling $4.533 trillion and becoming the most valuable company.
Market Performance and Factors Driving Growth
The third quarter concluded with significant upswings in most major stock indices. Partial trade agreements, a more flexible monetary policy, and growing interest in AI investments continue to fuel optimism among tech stock investors.
Alexandre Zilliox and Karen Kharmandarian, co-managers of the IA & Robotics Fund for Natixis, emphasized that investor interest lies in AI and technology. “Investors have always been keen to differentiate the level of exposure these companies have to AI and how much they will benefit from this technology. While the rising tide of AI last year lifted the Seven Magnificent, this trend will continue,” they explained.
Performance of Individual Stocks
Wall Street Advances, Except Meta:
- Roundhill Magnificent Seven ETF gained 16.92% to $64.83 units in Q3.
- Tesla stocks saw the highest increase (40%), followed by Alphabet (38.07%) and Apple (25.25%).
- NVIDIA gained 18.10%, and Microsoft increased by 4.30%.
- Amazon stocks saw minimal growth (0.08%), while Meta’s shares dropped 0.44%.
Future Outlook and Expert Predictions
Alik García, subdirector of Bursátile Analysis at Valmex, anticipates a combined 32.83% rise in net profits for Q3 reporting season. “We expect an 8.8% growth in net profits for the S&P 500, indicating that the Seven Magnificent will outpace the S&P 500 in growth for their eleventh consecutive quarter.”
