FEAR & GREED | Business News
Magnificent 7 tech stocks stumble, inflation hits target, White returns as king of Wisetech
Feb 26, 2025
The tech sector faces turbulence as the Magnificent Seven, especially Tesla, sees significant drops. Inflation is stabilizing, sparking optimism for rate cuts. Retail giant Woolworths struggles with disappointing earnings, while Westfield revamps malls into residential hubs. WiseTech's founder returns amid governance questions, and the energy sector navigates challenges influenced by political policies. Plus, the travel industry grapples with financial strains. A deep dive into cryptocurrency hints at shifting consumer attitudes, adding an intriguing twist!
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Quick takeaways
- The Magnificent Seven tech stocks, including Tesla, are experiencing a significant correction, raising concerns about future growth sustainability in the sector.
- Woolworths faces a challenging market with declining profits due to changing consumer preferences, while Richard White's return to WiseTech aims to stabilize operations and leadership dynamics.
Deep dives
The Tech Stock Correction
The Magnificent Seven tech stocks, which had previously led a significant rally in the market, are now officially in correction territory, with a drop of over 10% since mid-December. This decline includes a substantial 37% plunge in Tesla's share price, attributed to a 45% drop in sales in Europe, even as overall electric vehicle sales increased. Other major tech players like Amazon, Microsoft, and Alphabet have also seen their valuations shrink by at least 10%. This trend raises questions about the sustainability of the tech sector's prior growth, especially as investors consider reallocating their capital towards lower-priced sectors benefitting from government initiatives, such as manufacturing and steel production.
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