Latest news with #RoundhillMagnificentSeven
Business Insider
2 days ago
- Business
- Business Insider
One of Wall Street's biggest bulls sees tech powering an 11% gain in stocks through the rest of 2025
The US stock market looks like it's going to keep powering through to new records, says one of the biggest bulls on Wall Street. Christopher Harvey, the chief US equity strategist at Wells Fargo, predicts that the S&P 500 will reach 7,007 by the end of the year. His forecast — now one of the most optimistic on Wall Street — implies the benchmark index climbing another 11% from its current levels, or a 19% gain for the year. Speaking to Bloomberg about his thesis on Monday, Harvey pointed to a handful of reasons that would keep the market climbing higher: AI boom. Mega-cap tech stocks will likely keep climbing higher, Harvey said. He brushed off concerns that the hype over artificial intelligence resembled the dot-com bubble in the 1990s, noting that many companies today have stronger fundamentals. Large-cap tech and AI stocks have been on a tear since their low in early April, shortly after President Donald Trump announced his Liberation Day tariffs. The Roundhill Magnificent Seven ETF is up 41% from its April 8 low. "What we're seeing is the winners continue to win. The uber-cap companies have the higher margins, are gaining more market share. There is a real secular trade in AI that will continue," Harvey said. Strong mergers and acquisition activity. Dealmaking has remained relatively strong on Wall Street, another factor that should support the market, Harvey said. Strategic M&A activity was up 11% year-over-year from January through May, according to an analysis from the consultancy Bain & Company. "We think that M&A will continue to be very, very healthy up and down the capitalization," Harvey added. The US consumer remains strong. Americans keep spending, despite concerns that tariff-related price increases could shut off an important engine of the economy. Consumers ramped up their spending more than expected last month, with retail sales rising 0.6%, according to the US Census Bureau. The Fed is likely to cut interest rates. The central bank looks on track to e ventually lower interest rates despite hesitation stemming from President Donald Trump's tariffs in recent months. Investors are pricing in two or three rate cuts from the Fed by the end of 2025, according to the CME FedWatch tool. Those bullish factors override any concerns investors have over the market, Harvey said, pointing to concerns about the impact of tariffs and Trump's escalating feud with Fed Chair Jerome Powell. Investors are worried that tariffs could raise inflation while hampering economic growth, and that Trump could interfere with the Fed's independence, which could stoke inflation down the line. "We had seen Trump 1.0. We know his style," Harvey said, referring to the belief that the president goes hard on his policies before softening his tone. Harvey was one of the few strategists on Wall Street who stuck to his original S&P 500 target for the year, even during the historic sell-off in April as Trump unveiled his slate of tariffs. Forecasters like Goldman Sachs and JPMorgan lowered their stock forecasts and lifted their recession odds, before reversing once Trump paused most tariffs.
Time of India
08-06-2025
- Automotive
- Time of India
Trump-Musk rift rattles Wall Street; Tesla share slide exposes market fragility; major indexes take a hit
The public feud between US President Donald Trump and Tesla CEO Elon Musk has turned into both a political and a Wall Street drama, raising investor concerns and exposing the vulnerability of stock markets to sharp moves in major companies. The clash, which played out mostly on social media, triggered a 14% drop in Tesla shares on Thursday, after Trump threatened to cut off government contracts to Musk's companies. Thursday's decline reduced Tesla's market value by approximately $150 billion, with its weight in the S&P 500 and Nasdaq 100 at 1.6% and 2.6%, respectively. Tesla shares recovered partially on Friday, increasing about 5% by mid-day, reaching a market value of around $970 billion. Microsoft and Nvidia, both valued above $3 trillion, maintained weights of 6.9% and 6.8% in the S&P 500 as of Thursday. Despite a slight recovery on Friday, Thursday's sharp fall weighed heavily on major US indexes, with Tesla alone accounting for nearly half the day's declines. The company's decline made up nearly half of the day's losses for both the S&P 500 and the Nasdaq 100, which fell 0.5% and 0.8% respectively. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch vàng CFDs với mức chênh lệch giá thấp nhất IC Markets Đăng ký Undo The S&P 500 is widely seen as the key benchmark for the US stock market, while the tech-focused Nasdaq 100 underpins the popular Invesco QQQ ETF. "It's a widely held stock," said Robert Pavlik, senior portfolio manager at Dakota Wealth told Reuters. "When this big-name company that represents a sizable portion of the index sells off, it has an overall effect on the index, but it also has a psychological effect on investors," Pavlk added. The situation highlights long-standing concerns about index concentration in a small number of large-capitalisation stocks. The "Magnificent Seven", including Apple, Microsoft and Nvidia, collectively represented nearly one-third of the S&P 500's total weight as of Thursday's close. Though Tesla is the smallest among these tech and growth giants, it played a major role in driving index gains in 2023 and 2024. While 2025 started off uncertain, recent trends suggest signs of recovery. Tesla shares have dropped around 37% since mid-December, while the S&P 500 has fallen just 1% in the same period—reducing Tesla's overall influence on the index. Tesla is included in about 10% of the roughly 4,200 ETFs, giving it wide market exposure, according to Todd Sohn, ETF and technical strategist at Strategas. Some major funds affected include the Consumer Discretionary Select Sector SPDR Fund, which fell 2.5% on Thursday, and the Roundhill Magnificent Seven ETF, which declined 2.6%. "It's very important to know holistically what is in all your ETFs, because a lot of them are overlapping," the analyst noted. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Yahoo
06-06-2025
- Business
- Yahoo
Trump-Musk induced Tesla slide points to market risks from massive stocks
By Lewis Krauskopf NEW YORK (Reuters) -The rift between President Donald Trump and Tesla chief Elon Musk has captivated the world as a political drama, but it has also become a Wall Street spectacle, highlighting the risk to equity markets from the world's biggest stocks. Tesla shares slid 14% on Thursday as Musk and Trump feuded largely on social media, including the president threatening to cut off government contracts to Musk's companies. Although the stock modestly rebounded on Friday, Thursday's decline dragged down some of the most closely followed equity indexes, which are more heavily influenced by companies with the largest market values. Tesla's fall accounted for about half of Thursday's declines for both the S&P 500 and the Nasdaq 100, which fell 0.5% and 0.8% respectively, on the day. The S&P 500 is generally considered the benchmark for the U.S. stock market while the tech-heavy Nasdaq 100 is the basis for the Invesco QQQ Trust, one of the most popular exchange-traded funds. "It's a widely held stock," said Robert Pavlik, senior portfolio manager at Dakota Wealth. "When this big-name company that represents a sizable portion of the index sells off, it has an overall effect on the index, but it also has a psychological effect on investors." Tesla's decline points to the risk that many investors have long warned about, of indexes being heavily influenced by a handful of megacap stocks. Tesla is the smallest by market value of a group of massive tech and growth companies known as the "Magnificent Seven," which overall drove equity index gains in 2023 and 2024. The group has had a rockier 2025 so far, but more recently has been rebounding. The Magnificent Seven, which include Apple, Microsoft and Nvidia, had a combined weight of nearly one-third in the S&P 500 overall as of Thursday's close. "If you're an investor and you own the S&P or the Nasdaq 100 ... you just need to be aware that you own a lot of exposure to a very small cohort of names," said Todd Sohn, ETF and technical strategist at Strategas. Tesla's decline on Thursday knocked about $150 billion off its market value, while its weights in the S&P 500 and Nasdaq 100 stood at 1.6% and 2.6%, respectively. Tesla shares rebounded somewhat on Friday, up about 5% in mid-day trade, putting its market value around $970 billion. Microsoft and Nvidia, whose market values exceed $3 trillion, held weights of 6.9% and 6.8% in the S&P 500 as of Thursday. Tesla shares are down some 37% since mid-December, a period that has seen the S&P 500 fall about 1%, meaning its influence in the index has also declined over that time. The shares hold a broad influence among ETFs. Tesla has a varying presence in about 10% of the total universe of about 4,200 ETFs, according to Sohn. Those include the Consumer Discretionary Select Sector SPDR Fund, which sank 2.5% on Thursday, and the Roundhill Magnificent Seven ETF, which dropped 2.6%. "It's very important to know holistically what is in all your ETFs, because a lot of them are overlapping," Sohn said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
06-06-2025
- Business
- Yahoo
Trump-Musk induced Tesla slide points to market risks from massive stocks
By Lewis Krauskopf NEW YORK (Reuters) -The rift between President Donald Trump and Tesla chief Elon Musk has captivated the world as a political drama, but it has also become a Wall Street spectacle, highlighting the risk to equity markets from the world's biggest stocks. Tesla shares slid 14% on Thursday as Musk and Trump feuded largely on social media, including the president threatening to cut off government contracts to Musk's companies. Although the stock modestly rebounded on Friday, Thursday's decline dragged down some of the most closely followed equity indexes, which are more heavily influenced by companies with the largest market values. Tesla's fall accounted for about half of Thursday's declines for both the S&P 500 and the Nasdaq 100, which fell 0.5% and 0.8% respectively, on the day. The S&P 500 is generally considered the benchmark for the U.S. stock market while the tech-heavy Nasdaq 100 is the basis for the Invesco QQQ Trust, one of the most popular exchange-traded funds. "It's a widely held stock," said Robert Pavlik, senior portfolio manager at Dakota Wealth. "When this big-name company that represents a sizable portion of the index sells off, it has an overall effect on the index, but it also has a psychological effect on investors." Tesla's decline points to the risk that many investors have long warned about, of indexes being heavily influenced by a handful of megacap stocks. Tesla is the smallest by market value of a group of massive tech and growth companies known as the "Magnificent Seven," which overall drove equity index gains in 2023 and 2024. The group has had a rockier 2025 so far, but more recently has been rebounding. The Magnificent Seven, which include Apple, Microsoft and Nvidia, had a combined weight of nearly one-third in the S&P 500 overall as of Thursday's close. "If you're an investor and you own the S&P or the Nasdaq 100 ... you just need to be aware that you own a lot of exposure to a very small cohort of names," said Todd Sohn, ETF and technical strategist at Strategas. Tesla's decline on Thursday knocked about $150 billion off its market value, while its weights in the S&P 500 and Nasdaq 100 stood at 1.6% and 2.6%, respectively. Tesla shares rebounded somewhat on Friday, up about 5% in mid-day trade, putting its market value around $970 billion. Microsoft and Nvidia, whose market values exceed $3 trillion, held weights of 6.9% and 6.8% in the S&P 500 as of Thursday. Tesla shares are down some 37% since mid-December, a period that has seen the S&P 500 fall about 1%, meaning its influence in the index has also declined over that time. The shares hold a broad influence among ETFs. Tesla has a varying presence in about 10% of the total universe of about 4,200 ETFs, according to Sohn. Those include the Consumer Discretionary Select Sector SPDR Fund, which sank 2.5% on Thursday, and the Roundhill Magnificent Seven ETF, which dropped 2.6%. "It's very important to know holistically what is in all your ETFs, because a lot of them are overlapping," Sohn said.
Yahoo
23-05-2025
- Business
- Yahoo
The Magnificent 7 drove a $36 billion loss for short sellers as stocks soared after tariff chaos
The stock market rally since April lows has hammered short sellers. The biggest tech names have been the source of most of the pain for short bets. S3 Partners said shorting stocks in 2025 has been a "relative coin flip," with 48% of short bets being unprofitable. It's been a rough stretch for short-sellers. Investors betting againt US stocks saw the market value of their short positions decline by $257 billion from April 8 to May 20, data from S3 Partners shows. Of that total, the Magnificent Seven tech stocks drove $35.8 billion in the weeks since the stock market embarked on a rapid rebound from the tariff-induced April lows. S3 said that among the Manificent Seven group, short positions in Tesla, Nvidia, and Microsoft accounted for the steepest market value losses over the 42-day period. This embedded content is not available in your region. Tesla, which drove the steepest losses for short-sellers, has seen its stock price soar 54% since hitting a low on April 8. Investors shorting Elon Musk's carmaker are down $9.7 billion in mark-to-market losses since April 8. Nvidia, which saw the largest average short interest among investors over the timeframe, has seen its stock climb 38% since April 8. Short positions against the stock are down $9.6 billion in mark-to-market losses. Microsoft, which has rallied 29% since April 8, has driven $5.1 billion of losses for short-sellers. "Shorts felt like Marie Antoinette after Bastille Day when looking at their post-Liberation Day profit & loss statements," Ihor Dusaniwsky, the managing director of predictive analysis at the firm, wrote in the report. "Three out of every four short positions were unprofitable and short sellers were crowded into these trades with 95% of every dollar shorted on the losing side." It's been a difficult year for short-sellers, partly due to the volatility stemming from President Donald Trump's tariffs. Dusaniwsky wrote that shorting stocks. in2025 has amounted to a "relative coin flip," with 48% of all short positions unprofitable in the year. The stock market weathered a historic sell-off the week Trump announced his Liberation Day tariffs, but it has surged higher since, Major indexes are now up for the year. The Magnificent Seven has outperformed the broader market. The Roundhill Magnificent Seven ETF is up 28% since April 8, compared to the S&P 500's 17% gain in that time. Read the original article on Business Insider
