The Surprising Impact of the Magnificent Seven on the Stock Market

In recent months, the stock market has seen significant fluctuations, with some companies experiencing dramatic growth while others struggle to keep up. One group that has caught investors' attention is the so-called 'Magnificent Seven,' a collection of seven big tech stocks that have had an outsized impact on the overall performance of the S&P 500.

Nvidia, for example, rose an astonishing 417 percent, with Amazon following closely behind with a gain of 38 percent. While these companies may be smaller than some of their peers, they are still responsible for a significant portion of the index's movement since October 2022.

However, it's worth noting that not all of the Magnificent Seven have performed equally well. Royal Caribbean, the cruise line, has seen its stock surge by 212 percent, while General Electric has risen over 160 percent since the same period. In fact, some of these companies have done better than others in terms of pure price appreciation.

One company that stands out is Tesla, which may not be as high-flying as some of its peers but has still seen a significant surge of over 64 percent in the last twelve months. Moreover, this gain accounts for nearly 3 percent of the S&P 500 rally on its own – an impressive feat considering the company's relatively modest size.

The combined gains of the Magnificent Seven have accounted for more than 60 percent of the return in the S&P 500 over the last year, making them a significant force to be reckoned with. However, it's also worth noting that their impact can work both ways – when they struggle, as they did in the later months of 2022, the entire market tends to suffer.

Overall, the Magnificent Seven have had a profound impact on the stock market, and investors would do well to pay attention to their movements going forward.

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