Tech stocks plunged yesterday after President Donald Trump announced in a “proclamation” that he was imposing a new 25% tariff on imports of computer chips from foreign countries. Every single one of the Magnificent Seven tech stocks was down by the closing bell yesterday. Meta suffered the worst, down 2.47%. Oracle (not in the Mag 7 but closely related) was down 4.29%, perhaps because it is the hyperscaler most dependent on imported chips for its AI data center business.
The S&P 500 closed down 0.53%.
However, S&P futures this morning were up 0.36% prior to the opening bell. Traders may be buoyed by the fact that there is a rotation away from the Mag 7 going on among investors in S&P 500 stocks. The index was dragged down yesterday largely because the Mag 7 performed so poorly. But the notional “equal weight” S&P 500 actually rose 0.41%. It’s up 3.62% this year while the normal index is up only 1.18%.
The implication is that traders are selling down the Mag 7 but buying most of the other stocks.
