• MAG-7 ended 1Q24 with another positive month, posting a +2.2% gain in March. It ended 1Q +12.9%, beating both the S&P 500 and the Nasdaq to begin the year. For March, the S&P 500 led with a +3.6% gain, while the Nasdaq was up only +1.2%.
• NVDA (+14.2%) remained the biggest gainer as AI demand remained healthy. In comparison, TSLA (-12.9%) was the biggest laggard, with concerns over lower deliveries, increasing competition, and a recent rating downgrade from Wells Fargo.
• EV demand remains weak, particularly in China, while tech hardware faces continuous headwinds from longer upgrading cycles. However, this is overshadowed by strong AI-related demand and a resilient US economy. We maintain an OVERWEIGHT recommendation on the MAG-7 due to higher AI-driven growth and earnings upside for most MAG-7 companies driven by higher operating leverage and increased efficiency.

Summary

The Magnificent 7 ended off 1Q24 with another positive month of gains, posting a +2.2% increase in March, beating the Nasdaq (+1.2%), while lagging the S&P 500 (+3.1%) as the overall market rally continued to broaden outside of the biggest tech companies. MAG-7 is up +12.9% YTD, ~3% points better than the S&P 500.

Gainers: NVDA (+14.2 %) remained the biggest gainer as AI demand remained healthy and the semiconductor industry recovered generally.

Laggards: TSLA (-12.9%) was the biggest laggard due to concerns over lower deliveries, intensifying competition, and a recent rating downgrade from Wells Fargo.