But the reporting period that kicks off this week may prove sobering for equities bulls: While earnings from the so-called Magnificent Seven behemoths are still rising — and far outpacing the rest of the market — Wall Street anticipates a marked slowdown in growth relative to prior quarters. What it comes down to is that pressure is mounting on the cohort, which has driven a roughly US$15 trillion rally in the Nasdaq 100 Index since the end of 2022.
Investors are heading into yet another pivotal Big Tech earnings cycle with the companies’ shares near record highs and valuations stretched. A key distinction this time: The group’s profit growth is projected to come in at the slowest pace in almost two years.
Shares of Alphabet Inc, Meta Platforms Inc and other technology giants have rallied to start the year, outperforming the broader market amid a risk-on mood and high hopes for the billions of dollars the companies are spending to develop artificial-intelligence services.
