'Magnificent 7' Widens Gap With Rest Of S&P 500, But That May Change In 2024
Portfolio Pulse from Neil Dennis
The 'Magnificent 7' tech giants (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla) have outperformed the rest of the S&P 500, contributing significantly to the index's 24% gain in 2023. The Mag7 stocks are up 75% over the year, compared to just 12% for the S&P 493. The SPDR S&P 500 ETF also saw a record single-day cash inflow of $20.8 billion. Despite high valuations, fund managers remain bullish on these stocks. However, Piper Sandler predicts a consolidation period in 2024, with small-cap stocks expected to rally.
December 20, 2023 | 2:28 pm
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POSITIVE IMPACT
SPDR S&P 500 ETF mirrors the S&P 500's 24% gain and records a historic single-day cash inflow. It may continue to be influenced by the performance of the Mag7.
SPY's performance is directly tied to the S&P 500 and the Mag7's outperformance. The record inflow indicates strong investor interest, suggesting a positive short-term impact.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Apple's stock is up 52% this year, contributing to the S&P 500's gains. With high valuations, the stock may see a neutral short-term impact.
Apple's performance is significant for the S&P 500, but the high P/E ratio and potential consolidation could stabilize its short-term trajectory.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Amazon's stock has gained 83% in 2023, significantly outperforming the broader market. However, high valuations may temper short-term expectations.
Amazon's strong performance is a key factor in the S&P 500's gains, but the high P/E ratio suggests a cautious short-term outlook.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Alphabet's stock is up 56% in 2023, contributing to the S&P 500's overall performance. High valuations and potential consolidation may impact its short-term performance.
Alphabet's significant gain contributes to the S&P 500's performance, but high valuations and a predicted consolidation period could lead to a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Alphabet's stock is up 56% in 2023, contributing to the S&P 500's overall performance. High valuations and potential consolidation may impact its short-term performance.
Alphabet's significant gain contributes to the S&P 500's performance, but high valuations and a predicted consolidation period could lead to a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Meta Platforms' stock has surged 191% in 2023, but may face a neutral short-term impact due to high valuations and market consolidation predictions.
Meta's impressive gain impacts the S&P 500, but the high P/E ratio and predicted consolidation suggest a neutral short-term outlook.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Microsoft's stock is up 57% in 2023, but faces a neutral short-term impact due to high valuations and potential consolidation in 2024.
Microsoft's gains are crucial for the S&P 500's performance, yet the high P/E ratio and consolidation forecast may lead to a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Nvidia's stock has an extraordinary 239% increase in 2023. Despite this, high valuations could lead to a neutral short-term impact.
Nvidia's dramatic rise significantly affects the S&P 500, but the high P/E ratio and potential for market consolidation suggest a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Tesla's stock has risen 109% in 2023, but may see a neutral short-term impact due to high valuations and a predicted consolidation period.
Tesla's significant contribution to the S&P 500's gains is tempered by high valuations and the outlook for a high-level trading range in 2024, suggesting a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90