Nvidia And Tesla Left Behind, As Rest Of Mag7 Rally On Dem’s Big Night
Democrats flipped Congress and the Magnificent Seven fractured, with five megacaps surging while two of the group's biggest names moved in the opposite direction. The split points to a rotation that could reshape which companies lead the market through year-end.
The Magnificent Seven split in two on Wednesday morning, the day after Democrats won control of Congress. As of about 11:15 AM ET on Nov. 4, five of the seven megacap tech stocks were higher, and three of them were up more than 6%. NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) and Tesla (NASDAQ:TSLA) were the only two in the red. Many investors own these companies directly or through index funds, and Wednesday was a reminder that the group no longer trades as a single block.
The broader market was rising too. As of 11:26 AM ET, an S&P 500 tracking fund was up 1.35%, while a NASDAQ-100 tracking fund was up 0.87%.
Three Megacaps Jump More Than 6%
The group was led by Amazon (NASDAQ:AMZN), up 6.32% as of about 11:15 AM ET. Microsoft (NASDAQ:MSFT) was up 6.23% and Apple (NASDAQ:AAPL) 6.17%. Alphabet (NASDAQ:GOOGL) was up 3.46% at about 11:30 AM ET, and Meta Platforms (NASDAQ:META) was up 1.69% at 11:15 AM ET.
The gains came on top of very different years. As of Nov. 4, Apple was up 29.98% year to date, Amazon 15.48% and Microsoft 15.17%. Meta was still down 4.09% for the year and Alphabet 7.26%, so Wednesday’s moves only cut into those losses.
Nvidia and Tesla Move Against the Group
Nvidia was down 1.81% as of about 11:15 AM ET, even as Microsoft, Apple and Amazon rose. The chipmaker is still up 9.07% for the year.
Tesla had the worst morning of the seven, down 3.57%. It is also down 14.55% year to date, which makes it the only member of the group in the red for both the day and the year. Clarín reported that Tesla and SpaceX dove as the Dow surged after the midterms. Before the open, Yahoo Finance noted that Tesla “falls in premarket trading as investors weigh what the midterm results mean for Elon Musk’s companies.”
Apple Takes the Top Spot Back From Nvidia
Market data on Nov. 4 put Apple’s market value at $5.14 trillion and Nvidia’s at $4.89 trillion, a gap of about $249 billion. Microsoft was third at $4.11 trillion. As recently as Tuesday, Barron’s reported that Nvidia was set to surpass Apple again, and the lead has now changed hands within the same week. Moves of a few percentage points in either stock can flip it again.
Money Moves Away From AI Hardware
The split matches a wider rotation. “The blue trade is showing up already with money rotating out of the AI buildout and into what a Democratic Congress favors,” Anna Wu, founder of Floodlines Research, told Bloomberg. Bloomberg also reported that renewable energy stocks were benefiting from a rotation away from AI-related stocks.
Nvidia’s dip fits that reading, though one morning shows nothing. The biggest gainers were heavy AI spenders. Amazon plans about $220 billion in 2026 capital spending, and Microsoft about $170 billion for the calendar year. Investors bought the biggest AI spenders and sold the company providing their chips (the power, cooling, and networking names that feed those data centers are a separate basket we broke down in a free report on seven AI infrastructure suppliers that aren’t chipmakers). Tech also came into Wednesday under pressure: QQQ was down 7.78% over the past month, and the VIX volatility index stood at 20.83 on Nov. 3, a level read as raised uncertainty.
What to Watch Through the Close
The first question is whether the gap between the five gainers and the two losers holds up until the close or narrows by the end of the day. The second is whether Nvidia and Tesla recover, or whether money keeps moving out of AI hardware and into sectors seen as preferred by the new Congress. The third is whether Apple holds its lead in market value. With a $249 billion gap, a single strong session for Nvidia could put it back on top.
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AJ spent 10 years writing about financial markets at The Motley Fool. His coverage centers on technology stocks and the broader macroeconomic trends, from interest rates to geopolitics, that shape where markets are headed next. AJ is drawn to the stories where big-picture economics and individual companies collide.
