The Magnificent Seven has quickly become the Miserable Seven for investors this year.  

The broader weakness and the Iran war may have distracted investors from just how bad things have gotten for the megacap market leaders. The tech giants have been driving the market higher for years—now they’re leading the charge lower.

Microsoft stock has fallen 23% in 2026, on track for its worst quarter since the final three months of 2008 and its worst start to a year ever. Google owner Alphabet has also suffered a sharp decline—it’s down 15% from its closing high set just last month, and not far off bear-market territory.

Only Nvidia and Amazon have eked out gains since the Middle East conflict started, and they are still down 4% and 8% this year.

The entire group is at least 10% off their 52-week closing highs, ranging from Apple’s 12% fall to Microsoft’s 32% tumble, and Meta’s 25% slump in between, according to Dow Jones Market Data. Of course, those drops have all come after meteoric rises amid the artificial intelligence boom.

But it poses a tricky question for investors—is it time to buy back into these well-loved behemoths?

The rapid shift in interest-rate expectations since the war began on Feb. 28 won’t help the group. Markets now see a greater chance of hikes by the end of the year rather than cuts, according to CME’s FedWatch tool.

A Federal Reserve cutting cycle was a key argument against the AI bubble bursting—that defense has now collapsed. But the Mag 7’s poor run, and broader tech weakness, means plenty of air has come out of the market—that may not be a bad thing in the long term.

—Callum Keown

Get more of the journalism you love. Choose Barron’s as a preferred source in Google.

A state court in Los Angeles awarded $6 million in damages, half of it punitive, from Meta Platforms and YouTube parent Alphabet to a woman who said the social media apps’ addictive design contributed to mental health issues including anxiety and depression. The verdict could set a precedent.

• Both Meta and YouTube disagreed with the jury and will appeal. “Teen mental health is profoundly complex and cannot be linked to a single app,” Meta’s spokesperson said. Google said the case “misunderstands YouTube,” which it says isn’t a social media site. The verdict found Meta 70% responsible.

• The jury rejected the companies’ Section 230 defense, a law that says companies aren’t liable for third-party content posted on their sites. The now 20-year-old woman who sued said elements like “infinite scroll” aim to keep users glued to their phones.

• In a Northern California federal district courtroom, another trial consolidates over 2,000 similar cases into a single trial, and names Meta as the first defendant, along with other apps like YouTube, Snapchat, and TikTok. Hundreds of school districts and most U.S. states’ attorneys general have also filed lawsuits.

• A New Mexico jury on Tuesday ruled that Meta failed to protect young people from online dangers, including sexually explicit content, solicitation, and human trafficking, and ordered it to pay a $375 million penalty. Meta said it would appeal the ruling.

What’s Next: The plaintiff said apps like Instagram and YouTube keep users on their devices even as their mental health declines and makes them vulnerable to exploitation. If other cases cite this defense and courts say social media companies are responsible, future damages could be higher.

—Adam Levine

Microsoft stock is heading for its worst three-month start to a year ever, now about 32% lower than the all-time high closing price it reached just five months ago, when it closed at $542.07 on Oct. 28, 2025, according to Dow Jones Market Data. It’s having its worst six-month stretch since 2009.

• Just two weeks ago, , saying it hasn’t been this cheap in a decade. But some investors worry about the growth of its two main businesses: cloud computing and software, a product that has been under threat from AI across the tech industry.

• A note from UBS Global Research described reactions from the bank’s investors in Asia when asked to remark on Microsoft’s 365 Copilot offering. The AI-powered productivity tool had about 15 million subscribers at the end of the last quarter, but the investors said it should have had more.

• The analysts said the narrative around Microsoft 365/Copilot “needs to improve in order for the stock to really re-rate higher.” The investors in Asia concluded that Copilot has “disappointed” so far. Microsoft has lost nearly $1.28 trillion in market value since that October high mark, Dow Jones Market Data said.

• Microsoft told UBS that although it needs to innovate faster, it can be a successful “fast follower.” Despite investor skepticism about Copilot, Microsoft told UBS that Copilot usage picked up in its December quarter.

What’s Next: UBS said Microsoft offered no signal about Azure cloud-computing’s revenue growth and capacity additions beyond the March quarter, and the analysts sensed that the GPU shift that weighed on its stock could persist. Microsoft reports its March quarter earnings on April 28.

—Janet H. Cho

The Iran war and blockage of the Strait of Hormuz offer a stark reminder of a different geopolitical risk, one lurking in tech-heavy global portfolios that are betting on AI: Taiwan. Beijing claims the self-ruled island as its own and intends to unify it with the mainland, by force if necessary, making Taiwan a geopolitical tripwire.

• Investors often think China wouldn’t dare attack anytime soon because of the cascading ramifications. Their reasoning: If China were to invade, the damage wouldn’t be just to holdings such as Taiwan Semiconductor Manufacturing, which makes more than 90% of advanced semiconductors, but to the entire global economy.

• But the Iran conflict is a reminder of the risks to global chokeholds and the potential spillover from geopolitical conflict. One-fifth of the world’s oil passes through the strait. Taiwan produces three-quarters of global chip foundry revenue and is home to companies crucial to anything with an on/off switch.

• While the International Energy Agency released 400 million reserve barrels of oil to blunt the effects of the Hormuz closure on energy prices, no such stash exists for chips. China’s levers to exact financial pain would have an effect far wider than what Iran can inflict, Hoover Institute fellow Eyck Freymann observes.

• Taiwan has at least three months of oil stockpiled. It is turning on some of its coal-fired plants (40% are typically idle), buying coal from Indonesia and Australia, and preparing for other disruptions by improving its recycling technology for rare-earth minerals and sourcing helium, needed in chipmaking, outside Qatar.

What’s Next: Taiwan’s chip-oriented companies can navigate the disruptions for a short while—even possibly through summer—in part by paying more for what they need from other suppliers, passing that extra cost to customers, and possibly delaying chip production for goods such as smartphones and computers. For more read here.

—Reshma Kapadia

With expectations rising for Elon Musk’s SpaceX to launch an initial public offering, filing paperwork for a deal perhaps as early as this week, attention has turned to a number of funds that already own pre-IPO shares in the commercial space company, or have figured out a way to gain exposure.

• One little-known holder of SpaceX stock is Blue Owl Technology Finance, a depressed business development company focused on high-yield technology lending in the private credit market. It owned about 500,000 shares of SpaceX that were valued at around $195 million at year-end.

• The closed end Destiny Tech 100 has 16.2% of its fund invested in SpaceX and another 3.5% in Musk’s xAI, which recently merged with SpaceX. And the Fundrise Growth Tech Fund, which recently began trading on the NYSE, has a 5% stake in SpaceX.

• Several other prominent funds own SpaceX, such as Cathie Wood’s Ark Venture, where it’s the biggest holding at 18% of the fund, and the Baron Partners Fund, Baron Focused Growth Fund, and Baron First Principles exchange-traded fund. Fidelity, BlackRock, and Neuberger Berman own pre-IPO shares of SpaceX, Morningstar says.

• SpaceX is reportedly looking at a $1.75 trillion valuation. In December, Musk confirmed the IPO plan, likely the largest ever, to kick-start the rocket company’s AI ambitions. The Information reported Tuesday that the filing could come this week.

What’s Next: When SpaceX’s IPO prospectus is finally public, investors will get a look at one of the most unique companies on the planet, responsible for essentially creating the modern space economy by driving down the cost of reaching space through its pioneering use of reusable rockets.

—Paul R. La Monica, Andrew Bary, and Al Root