Tech stocks, including 'Magnificent Seven,' rebounded 3.3% after recent decline, facing challenges from Chinese AI.
From Nasdaq: 2025-03-27 08:00:00
- The "Magnificent Seven" tech group, including Tesla, NVIDIA, Alphabet, Microsoft, Amazon, Apple, and Meta, saw a 3.3% rebound on March 24, 2025, after a month of decline. The MAGS ETF is down 5.5% in the same period.
- Despite President Trump’s 25% tariffs announcement on foreign vehicles, tech momentum remains strong. Uncertainty around tariffs and Fed decisions still looms over tech stocks’ potential.
- The Magnificent Seven faced challenges from Chinese AI advancements like DeepSeek and Alibaba’s QwQ-32B model, raising concerns about returns on AI investments by U.S. tech giants.
- Trump tariffs, Fed policies, and AI advancements have impacted tech stocks, but potential gains are seen for Meta, Apple, and Amazon due to DeepSeek’s progress and investments in AI infrastructure.
- Market reactions to U.S. tech companies may have been exaggerated due to DeepSeek fears, but analysts believe efficient AI models like DeepSeek could drive further growth in AI infrastructure.
- Tech sector earnings for Q1 are expected to be +12.7% from last year, with the Magnificent Seven group forecasted to have +13.9% earnings growth. ETFs like MAGS, FNGS, MGK, XLG, and OEF are in focus amid these developments.
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Read more at Nasdaq: Can the Tide Turn for ‘Magnificent Seven’ Stocks? ETFs in Focus