Market Update: Mag 7 Stocks in Correction
As of February 13, 2026, the Magnificent Seven stocks—Amazon, Microsoft, Alphabet, Meta, Nvidia, Apple, and Tesla—are facing significant downward pressure, entering a technical correction after collectively falling more than 10% from their October peaks. This shift in market sentiment is primarily driven by renewed investor concerns regarding artificial intelligence (AI) expenditures and the uncertain return on investment (ROI) associated with these high capital outlays.
Recent Developments
A recent article from Barron’s highlights that the Roundhill Mag 7 ETF has experienced a decline of nearly 11% since its October highs, with Amazon and Microsoft both officially entering bear market territory, down over 20%. Specifically, Amazon has slipped approximately 21.4%, closing at $199.60, largely due to apprehension surrounding its ambitious $200 billion AI capital expenditures planned for 2026, which are the highest among hyperscale cloud providers. Meanwhile, Alphabet has seen a 6.4% decrease this month, and Tesla is down 7.3% in 2026, as concerns mount over its CEO’s AI automation strategy.
MarketWatch corroborates these findings, emphasizing that investors are increasingly cautious about the projected $650 billion AI spending by Amazon, Microsoft, Meta, and Alphabet this year. The report suggests that investors are shifting their focus toward firms like Alphabet and Broadcom, which are perceived as less exposed to the volatility associated with AI investments. Nvidia’s forthcoming earnings report, scheduled for February 25, is expected to be a pivotal event that could provide insights into the effectiveness of these AI investments.
Market Volatility and Sector Rotation
According to Barron’s, U.S. stocks have surrendered all gains for the year amid the tech sell-off driven by AI concerns. The Magnificent Seven index has entered correction territory, with volatility indicators like the VIX surging as capital rotates away from AI-exposed sectors. Despite the current turmoil, experts maintain that long-term productivity gains from AI are likely, albeit with ongoing market volatility.
A Financial Times report from a week ago indicates a divergence in performance among the Mag 7 stocks. While Alphabet is holding up relatively well, Nvidia is facing challenges. As scrutiny over AI investments intensifies, investors are becoming more selective, with Seema Shah from Principal Asset Management noting that the AI sector is maturing, rewarding only the most resilient technology firms. Deutsche Bank’s Jim Reid cautions that if more members of the Magnificent Seven falter, it could have broader implications for the U.S. economy and markets.
Current Market Data
As of the latest intraday data, here are the prices of the Magnificent Seven stocks:
- Apple (AAPL): $260.18
- Microsoft (MSFT): $404.68
- Alphabet (GOOGL): $306.73
- Amazon (AMZN): $198.90
- Meta (META): $644.03
- Tesla (TSLA): $415.33
Amazon’s current price confirms its bear market status, while others remain in correction territory. The slight intraday declines reflect the prevailing caution among investors.
Expert Opinions
UBS analysts recommend diversifying across sectors and geographies, emphasizing that the value creation associated with AI is not confined to U.S. tech firms. Seema Shah’s insights suggest that only the most resilient tech companies will thrive in this evolving landscape. Additionally, Jim Reid warns of the potential economic risks if more members of the Magnificent Seven continue to struggle.
Conclusion
The Magnificent Seven stocks are currently navigating a technical correction, with Amazon and Microsoft firmly in bear market territory. Investor concerns surrounding high AI spending and uncertain short-term returns are the primary catalysts for this downturn. The divergence in performance among these stocks highlights the need for selective investment strategies moving forward, especially as the market anticipates Nvidia’s earnings report later this month.
In summary, while the immediate outlook appears challenging for the Magnificent Seven, the long-term potential of AI remains a critical area of focus for investors.
Comments are closed.