2 charts show why Magnificent 7 stocks are being loved again

Morgan Stanley’s earnings analysis shows the Magnificent Seven (Apple, Nvidia, Amazon, Google, Microsoft, Meta and Tesla) are set to sharply out-earn the broader S&P 500, driving investor rotation back into AI-focused mega-cap tech. Morgan Stanley projects Mag Seven net income growth of about 25% in 2026 versus roughly 11% for the S&P 493, with outperformance likely to persist into 2027. The shift has already shown in prices: the average Mag Seven stock is up ~11% over the past month, led by Amazon’s ~20% gain. Positive results and an upbeat outlook from Taiwan Semiconductor (TSM.N) reinforced the AI demand narrative, while investors pulled back from defensive oil and gold positions. The piece signals a bullish market tilt toward large-cap tech, supporting further index concentration in the US SP 500 around AI-driven earnings momentum.