Stock market’s ‘Magnificent Seven’ is really now the Fab Four as Apple, Alphabet, and Tesla sputter

Even as the stock market is heads higher, the “Magnificent Seven” trade is beginning to fizzle, with Apple, Alphabet, and Tesla sputtering through the first quarter of 2024.
Hardika Singh for The Wall Street Journal:
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The S&P 500 climbed 10% in the first quarter, its best start to a year since 2019, even though two of its biggest constituents suffered double-digit declines. Apple shares fell 11% in the first three months of the year, while Tesla dropped almost 30%. Alphabet shares sputtered for much of the period before making a run in the past three weeks and ending up 8%.
The other four big tech stocks in the group known as the Magnificent Seven — Nvidia, Meta Platforms, Microsoft, Amazon.com — continued their meteoric run and outpaced the broader market. Some market strategists have dubbed them the new Fab Four.
Nvidia continues to be a stock-market star. The graphics-chip maker has indicated demand for the computing power that underlies AI remains astronomical. Its shares have jumped more than 80% to start the year, after more than tripling in 2023. 
Meta shares, meanwhile, have soared partly thanks to Meta’s investments in artificial intelligence that have made targeted ads smarter. The social-media company recently said it would pay its first shareholder dividend. Microsoft stole the crown of biggest U.S. company from Apple earlier this year, with a valuation that topped $3 trillion, and Amazon has sharply improved its profitability.
[Apple] is facing another weak iPhone demand cycle, and investors are worried that Apple is behind in the current wave of excitement around AI.
Bespoke Investment Group data show Apple shares underperformed the S&P 500 over the 200 days through Tuesday by the widest margin since October 2013. 

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MacDailyNews Take: As we just wrote:

Apple was caught flat-footed, due to a lack of vision on the part of leadership. They were, uh, focused elsewhere. Apple’s traditional data center network is not fit for generative AI. It will take years and billions of dollars to catch up just to where GenAI leaders (OpenAI, Microsoft, Alphabet, etc.) are today.
So, the only solution is to partner with a Google for the real GenAI stuff while pretending (marketing) really hard that some on-device AI Apple has whipped up in a few months is “insanely great Apple innovation” that’s at the heart of Apple’s 2024’s AI announcements when it’s really just an adjunct. Apple will tout their homegrown on-device AI and act like it’s powering everything when, in reality, it’s Google (or whichever is licensed) that’s powering most of it. Watch Apple make a big show of its on-device AI at WWDC and run many ads touting it from June onwards.
Apple hopes to buy time for the data center buildouts and investments that will be required for them to someday own their own AI technology and not have to license it from the likes of Google.
This is what happens after a decade plus with a caretaker CEO at the helm after he hits the last page of his iteration playbook, yet attempts to stay in the game for too long.

See also:
• Work on Apple Vision Pro began under Steve Jobs – August 23, 2023
• Contrary to popular belief, Steve Jobs knew about Apple Watch – February 13, 2023
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