July’s tech selloff reverberated across the market as investors moved away from mega-cap stocks and high-growth sectors, opting instead for smaller-cap stocks and sectors that could benefit from potential interest rate cuts. This significant shift in sentiment severely impacted the Magnificent Seven companies, wiping trillions off their market value. While most have started to recover, their stock values remain significantly lower than two months ago.
According to data from Stocklytics, the combined market cap of the Magnificent Seven companies reached $15.6 trillion this week, $1.2 trillion below its July peak.
Microsoft, Alphabet, and Meta Suffer the Biggest Losses
After adding an impressive $4.8 trillion to their combined market value in the first half of 2024, and positioning the year as a potential record for growth, the Magnificent Seven faced a rough patch in July.
Factors such as expanded U.S. government export restrictions on AI chips to China, anticipation of future interest rate cuts shifting investors toward more rate-sensitive sectors like real estate and financials, geopolitical tensions, and underwhelming earnings reports from Alphabet and Tesla contributed to the tech selloff, slashing trillions from their stock values.
In July, the combined market cap of Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla was $16.8 trillion—just shy of China’s GDP. Since then, their collective value has fallen by $1.2 trillion, settling at $15.6 trillion.
Despite initial concerns, Nvidia has rebounded more quickly than expected. Its stock value reached $3.48 trillion this week, still $60 billion shy of its July figure but reflecting a year-to-date gain of $1.97 trillion. Apple and Amazon experienced similar losses, with market caps dropping by $60 billion and $50 billion, respectively. Tesla, the most valuable carmaker, saw a $107 billion decline in market value over the last two months.
Conversely, Microsoft, Alphabet, and Meta have seen slower recoveries. Meta’s market cap remains $210 billion below its July levels, now standing at $1.32 trillion. However, its year-to-date gain is still a notable $411 billion. Alphabet has lost $350 billion, while Microsoft endured the sharpest decline, losing $380 billion in market value. Microsoft’s stock, which was valued at $3.48 trillion in July, now sits at $3.1 trillion.
The Magnificent Seven’s Combined Stock Value Still Surpasses Major Economies
Despite a $1.2 trillion drop in under two months, the combined valuation of the Magnificent Seven remains remarkable when compared to global industries and economies.
Their collective market cap of $15.6 trillion still exceeds the combined GDPs of Japan, Germany, India, and the UK. Additionally, the seven tech giants are worth more than the automotive, healthcare, and energy industries combined, with only China’s GDP standing above their current stock value by approximately $2 trillion.
