Tech Selloff Leads Magnificent Seven to Nearly Its Worst Day Ever by This Metric

Declines in Tesla, Nvidia and other large tech stocks meant a $598 billion market-cap wipeout for the ‘Magnificent Seven’ — the second-largest one-day total on record

Shares of Jensen Huang’s Nvidia — a key component of the “Magnificent Seven” — fell Thursday.

Thursday’s selloff in large technology companies resulted in the second-largest one-day market-capitalization erasure for the “Magnificent Seven” on record.

All seven technology stocks were off at least 2.3% in Thursday trading. The activity translated to a $598 billion single-day collective loss of market cap for that grouping — the biggest wipeout since a $602 billion loss on Feb. 3, 2022, according to Dow Jones Market Data.

Tesla Inc.’s stock was the biggest daily loser of the bunch, off 8.4% as it snapped its 11-session winning streak in a big way, with its largest one-day decline since a 12.1% fall on Jan. 25, according to Dow Jones Market Data. While Tesla shares were up earlier in the session, they pulled back sharply following a Bloomberg News report saying that the company plans to delay its robotaxi event to October from August.

MarketWatch has sought comment from Tesla, which has disbanded its media-relations team.

Shares of Nvidia Corp. and Meta Platforms Inc. — the two biggest year-to-date winners in the group — were the next most sizable daily losers, each off more than 4%. Alphabet Inc., Amazon.com Inc., Apple Inc. and Microsoft Corp. are the other members of the Magnificent Seven.

The last time all seven stocks finished down at least 2% was on Dec. 22, 2022, according to Dow Jones Market Data.

The weakness in large technology shares Thursday came as the latest U.S. consumer price index readings showed cooling inflation, which was fueling hopes for a September interest-rate cut by the Federal Reserve. The rate-cut expectations, in turn, had investors selling tech winners as they gave a fresh look to shares of companies like homebuilders, pool suppliers and others that stand to benefit from lower rates.

“The Magnificent Seven names have exhibited high levels of insensitivity to interest rates,” meaning “they won’t be the beneficiaries of new easing,” wrote Mike O’Rourke, CMT chief market strategist at JonesTrading.

The Nasdaq Composite Index was off 364 points, or 2.0%, while the S&P 500 was off 49 points, or 0.9%, and the Dow Jones Industrial Average was ahead 32 points, or 0.1%.