AI Generated Image
'Magnificent 7' stocks erase $797 billion in market value in worst day since April 2025
Yahoo Finance • • business
Key Points:
- The "Magnificent Seven" megacap stocks, including Microsoft, Amazon, Apple, Alphabet, Nvidia, Tesla, and Meta, experienced their largest one-day drop since April 2025, losing about $797 billion in market value.
- Alphabet and Tesla led the decline with shares falling 6% and 14%, respectively, following their quarterly earnings reports; Tesla alone lost approximately $200 billion in market value.
- Despite Alphabet's strong revenue and cloud services backlog, investors were concerned about increased capital expenditures on AI infrastructure, prompting a sell-off in hyperscaler stocks.
- Shares of memory chip makers such as Micron Technology, SK Hynix, and Sandisk rose, benefiting from the increased spending on AI infrastructure, while Tesla plans heavy AI investments toward autonomous vehicles and robotics.
- Experts advise investors to diversify into more affordable stocks with actual earnings rather than those reliant on uncertain future growth, a caution particularly relevant to Tesla's valuation.
