Despite a market rebalancing away from large tech companies, reflected by an over 10% correction in the Roundhill Magnificent Seven ETF (NYSE: MAGS) in the past two weeks, the so-called "Magnificent Seven" companies still comprise an outsized portion of the S&P 500.
The Data: The Magnificent 7 comprises seven of the largest U.S. technology companies weighted heavily in the SPDR S&P 500 ETF Trust (NYSE: SPY).
- Apple Inc (NASDAQ: AAPL), 6.93% of the index.
- Microsoft Corp (NASDAQ: MSFT), 6.66% of the index.
- NVIDIA Corp (NASDAQ: NVDA), 5.95% of the index.
- Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL), 4.45% of the index.
- Amazon.com Inc (NASDAQ: AMZN), 3.94% of the index.
- Meta Platforms Inc (NASDAQ: META), 2.45% of the index.
- Tesla Inc (NASDAQ: TSLA), 1.4% of the index.
All components have been in the red over the past 10 market sessions at a higher magnitude than the nearly 3% drop seen in the overall S&P 500. The small-cap Russell 2000 index is up nearly 10% in that period.
Still, the Magnificent 7 collectively comprise around 32% of the S&P 500.
Why it Matters: The data reflects a persistent market bullishness in artificial intelligence and Big Tech.
The current correction has lessened Magnificent 7's year-to-date performance to a degree, but the Roundhill ETF, which tracks the seven companies, is still up over 35% in 2024.
Several experts have predicted a larger market correction, describing the valuations of NVIDIA and other heavily weighted stocks as "bubble-ish."