S&P 500 Hits 5,000, Magnificent 7 Tops $13 Trillion, Commercial Real Estate Cracks Emerge: The Week In The Markets

The S&P 500 index surged past the 5,000-point threshold by the week’s end, setting new record highs on the optimism surrounding artificial intelligence. Both the S&P 500 and the Nasdaq 100 celebrated their 14th positive week out of the last 15, showcasing the resilience of the winter rally.

The Magnificent Seven companies – Microsoft Corp. MSFT, Apple Inc. AAPL, Alphabet Inc. GOOG GOOGL, Amazon Inc. AMZN, Meta Platforms Inc. META, NVIDIA Corp. NVDA and Tesla, Inc. TSLA – collectively skyrocketed to a market capitalization of $13 trillion, accounting for nearly half of the entire U.S. economy and matching the combined GDP of Germany, Japan and India.

Among the Russell 1000, Palantir Technologies Inc. PLTR emerged as the top performer of the week, surging over 40%. Conversely, New York Community Bancorp NYCB lagged behind, plummeting nearly 30% amid concerns surrounding its commercial real estate portfolio.

Chart of The Week: S&P 500 Breaks 5,000, Notches Fifth Straight Week Of Gains

Tesla’s Shaky Status: Tesla’s position among the Magnificent Seven group of largest S&P 500 companies is in jeopardy as its market cap falls, placing it ninth. Eli Lilly Company LLY and Berkshire Hathaway Inc. BRK have surpassed Tesla, with Broadcom closely trailing and poised to join the ranks. Tesla’s recent stock decline reflects challenges that include slowing electric vehicle demand.

Facebook Turns 20: Investing $1,000 in Facebook at its IPO in May 2012 would have grown to $10,180 by February 2024, reflecting a significant return. Despite controversies and challenges, Facebook’s parent company Meta Platforms has shown resilience, with strong financial performance and strategic acquisitions contributing to its growth.

Novo Nordisk's Gold Standard: Novo Nordisk NVO’s weight-loss drugs Wegovy and Ozempic are driving a transformation in the food industry as CEOs adapt to the decreased appetite these medications cause. This has led to a push for healthier food options in response to the changing consumer demand, affecting companies from Walmart Inc. WMT to Chipotle Mexican Grill Inc. CMG.

Ackman Targets Retail Investors: Billionaire Bill Ackman launched Pershing Square USA, a proposed fund on the NYSE aimed at retail investors, with no minimum investment requirement. This move democratizes access to hedge fund investments, leveraging Ackman’s notable successes.

Alexa’s Privacy Implications: Amazon’s Alexa, now in 100 million homes, is set for significant AI enhancements, as announced by Jeff Bezos. Despite its popularity, concerns are growing over privacy, with Alexa’s deep integration into daily life raising questions about the balance between convenience and user privacy. Amazon aims to make Alexa more conversational and personalized, highlighting the potential trade-off of increased convenience against privacy risks.

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