The “magnificent seven” tech giants have seen a staggering $280 billion erased from their collective market value after a series of earnings reports were released on October 25, sparking concerns about a potential downturn in the tech sector.
The “magnificent seven” refers to the major blue-chip tech companies, namely Apple, Microsoft, Meta, Amazon, Alphabet, Nvidia, and Tesla, which together constitute a quarter of the S&P 500 index’s total value.
Alphabet, the parent company of Google, experienced a dramatic 9% drop in its stock price, erasing $180 billion from its market capitalization. This marked Google’s worst performance since the onset of the COVID-19 pandemic in March 2020.
Looking at the share price movements of Alphabet Inc Class A over the last five days from Google Finance data:
The stocks of Amazon, Nvidia, and Meta also saw declines, falling by 5.5%, 4.3%, and 4.2% respectively, as reported by Y Charts.
On the other hand, Apple and Tesla witnessed milder declines in their stock prices, dropping by 1.35% and 1.9% respectively. Meanwhile, Microsoft stood out as the only one among the seven to go against the trend, with its stock price climbing 3.1% following an impressive growth report from its Azure business.
“This widespread tech sell-off, the most significant we’ve seen in months, has pushed the S&P 500 to its lowest point in five months,” said Kobeissi.
“When the few stocks that have been propping up the entire market start to fall, this is the result,” the firm commented, highlighting that investors in tech stocks might be starting to factor in a recession.
“As headwinds continue to build, it appears that buyers are growing more cautious,” Kobeissi added in a subsequent remark.