Big Tech Stocks Drive Market Gains, Fuel Bubble Fears
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The Magnificent Seven (big tech stocks) accounted for 45% of the S&P 500's gains in January, fueling concerns of a dot-com-like bubble.
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With a $12.5 trillion market cap, the Magnificent Seven now exceed the GDP of major global cities like New York and Tokyo.
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Market behavior mirrors periods after recessions or bubbles when both yields and equities rise simultaneously.
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Excluding Tesla, the Magnificent Seven accounted for 71% of the S&P 500's January gains.
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Investors are advised to watch a mix of high-growth and distressed assets to navigate potential frothiness.