BONUS: The Mag 7's Link to the S&P Just Broke  ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

March 23, 2026   |   Read online Elon Musk's $1 Quadrillion AI IPO BONUS: The Mag 7's Link to the S&P Just Broke A message from our friends at Brownstone Research (Sponsor) Elon Musk's $1 Quadrillion AI IPO Editor's Note: Former tech executive and angel investor Jeff Brown — picked Bitcoin before it jumped as high as 52,400%, Tesla before it jumped as high as 2,150%, and Nvidia before it jumped as high as 32,000%. Today, he'll show you how to claim a stake in Elon Musk's upcoming IPO – BEFORE the company goes public. Click here to see the details or read more below. Dear Reader, Have you heard of Elon Musk's $1 quadrillion IPO? If not, click here now because it's set to be the biggest AI IPO in history… And you could claim a stake today... Before the company goes public… Starting with just $500. You see, this IPO is a key part of Elon Musk's secret AI masterplan… A plan that I believe will unlock the full power of artificial intelligence… Unleashing what Elon Musk is predicting will be… A $1 quadrillion new wealth wave. Just to put that into perspective… That would be enough to send a check for $2.8 million to every man, woman, and child in America. That's how big this opportunity is. Click here now and I'll give you all the details. We have so much to look forward to, Jeff Brown Founder & CEO, Brownstone Research BONUS ARTICLE The Great Decoupling: Why Big Tech May Be Entering Its Next Phase For the better part of three years, owning U.S. equities meant making one giant, concentrated bet. Not on the economy. Not on valuation. Not even on the S&P 500 in the old-fashioned sense. It meant betting that seven stocks could keep carrying almost everything else. Apple. Microsoft. Nvidia. Amazon. Alphabet. Meta. Tesla. That trade worked so well for so long that many investors stopped noticing how fragile it had become. When one cluster of companies dominates index returns, passive investors feel smart, active managers feel trapped, and every earnings season turns into a referendum on whether the market's heaviest names can once again do the impossible. Now that structure is changing. Bloomberg reported on March 22 that the correlation between an index tracking the Magnificent 7 and the equal-weighted S&P 500 turned negative on February 23 and has continued to fall as oil shock and war-driven macro stress reshaped sector leadership. In plain English, Big Tech and the average stock have stopped moving in lockstep. That sounds technical. It is not. It is one of the most important changes in market structure investors have seen in this cycle. Because when the Mag 7 decouples from the broader market, two things happen at once. The rest of the market gets a chance to breathe without needing Nvidia or Microsoft to do all the work. And Big Tech gets something it has not had much of lately: room to trade on its own earnings power rather than as the entire market's emotional support system. That is the real story here. This is not about Big Tech losing relevance. It is about Big Tech losing some of its burden. The Scoreboard: What Actually Happened Let's begin with the hard numbers. Technology accounts for about 33% of the S&P 500, while the next-largest sector, financials, sits closer to 12.4%. That means the market can still struggle to make major headway without tech, but it also means even a modest broadening in leadership can materially reduce concentration risk. Reuters reported in January that the equal-weight S&P 500 had gained more than 5% since late October, compared with roughly 1% for the standard cap-weighted S&P 500 over the same stretch. That is a quiet but meaningful sign that the average stock had started to outperform the index's largest names. At the same time, the Magnificent 7 remains enormous in absolute terms. Based on current market caps, Nvidia is about $4.53 trillion, Apple about $4.05 trillion, Microsoft about $3.59 trillion, Alphabet about $2.94 trillion, Amazon about $2.34 trillion, Meta about $1.84 trillion, and Tesla about $1.43 trillion. Together, that is well over $20 trillion of market value concentrated in seven names. And the valuations are no longer uniform. Apple trades at roughly 34.4 times earnings, Microsoft 30.1, Nvidia 45.6, Amazon 30.6, Alphabet 23.6, Meta 31.5, and Tesla a nosebleed 282.3. So "the Mag 7" now includes everything from a relatively cheaper mega-cap compounder like Alphabet to a sentiment-heavy story like Tesla. That internal divergence matters, because the market is starting to treat them less like one trade and more like seven separate cases. What the Market Is Really Saying The old regime was simple. If Big Tech rallied, the S&P 500 rallied. If Big Tech stumbled, the whole tape looked sick. That is why every question about AI capex, cloud growth, ad monetization, consumer hardware demand, and data-center spending began to feel like a question about the entire U.S. stock market. Now the market is sending a different message. It is saying industrials, energy, healthcare, financials, and even some smaller companies can contribute more than they did in the narrowest phase of the AI bull market. Reuters reported that all 11 S&P sectors are expected to post earnings growth this year, while technology is still expected to lead with roughly 30% to 33% earnings growth in 2026 versus about 14.8% to 15.5% for the broader S&P 500. That is a healthier setup than the one investors got used to. Notice what that means. Tech is still the growth engine. It is just no longer the only engine. That distinction is everything. Because when leadership broadens, the most important stocks in the market no longer need to be perfect every quarter. They can be excellent instead of supernatural. For Big Tech bulls, that is not a threat. It is a relief. The AI Spending Machine Is Still Intact Here is the part bears keep underestimating. The decoupling is happening at the same time that the biggest technology companies are still spending at a breathtaking pace on AI infrastructure. Reuters reported in February that Bridgewater estimates major U.S. tech firms will invest about $650 billion in AI infrastructure in 2026, up from roughly $410 billion in 2025. Another Reuters report described 2026 AI spending plans around $600 billion, while a January Reuters piece said Alphabet, Microsoft, Meta, and Amazon were on track to lift AI spending by 30% to more than $500 billion this year. And the company-level numbers are not subtle. Alphabet said its 2026 capital spending could reach $175 billion to $185 billion. Amazon, in Reuters' February coverage, was tied to plans for roughly $200 billion of spending. Meta is projecting capex of up to $135 billion in 2026, while Reuters said Microsoft, Amazon, Meta, and Alphabet together are expected to pour more than $630 billion into AI-related buildout. That is the deeper reason the Mag 7 still matters, even in a broadening market. This is not just a stock-market story anymore. It is a capital cycle. A power cycle. An infrastructure cycle. AI spending is now large enough that Bridgewater says it could add about 100 basis points to U.S. GDP growth in 2026, while also creating inflation pressure in tech equipment and electricity. So yes, the link between the Mag 7 and the equal-weight S&P has weakened. But the link between Big Tech and the future shape of the economy may actually be getting stronger. A Unique Angle Investors Are Missing Here is the second-order effect most people are glossing over: Decoupling may make Big Tech more investable, not less. Why? Because concentration was always a hidden tax on the group. When seven stocks are expected to deliver index-level returns, their multiples carry an extra burden. Investors are not just paying for earnings growth. They are paying for market leadership, passive inflows, benchmark support, and psychological safety. That is how expectations get distorted. A broadening market reduces that burden. If industrials and energy can lead for stretches while tech consolidates, then Nvidia does not have to rescue the S&P every time oil spikes. Microsoft does not have to justify the whole market's forward multiple. Alphabet can be judged on whether its cloud business and AI monetization justify 23.6 times earnings, not on whether it can single-handedly hold the Nasdaq together. That is a far more sustainable setup. It lets the Mag 7 transition from market locomotive to market franchise. And franchises tend to last longer than tactical trades. Not All Seven Deserve the Same Verdict This is where the analysis has to get more selective. Nvidia remains the purest AI infrastructure bet, and investor optimism is still real. Barron's reported that BNP Paribas has a $270 target on Nvidia, well above current levels near $172.70. But Nvidia also carries the richest non-Tesla earnings multiple in the group, at 45.6 times earnings, so a lot still has to go right. Microsoft and Amazon are in a different category. Their capex is enormous, but so are their cloud and enterprise footholds. Reuters noted that Microsoft posted its strongest profit growth in two years, while Amazon's spending surge has also fueled investor anxiety about near-term profitability. These are still compounders, but they are now being judged on AI return on capital, not merely on growth itself. Alphabet may be the most interesting value-versus-growth tension in the group. It trades at about 23.6 times earnings, materially cheaper than Apple, Microsoft, Meta, and Nvidia, even as Reuters reported Google Cloud revenue growth of 48% and 750 million monthly users for its ChatGPT competitor. If you want a Mag 7 name where valuation leaves more room for execution, Alphabet stands out. Meta is more complicated. The core ad machine remains powerful, but it is also the clearest case of AI spending pressure colliding with investor patience. Reuters reported Meta may lay off over 20% of staff and that its 2026 capex could hit $135 billion. Rosenblatt estimates that such cuts could save around $6 billion and boost core earnings by 5%. That is not a broken company. It is a company trying to prove that AI intensity and margin discipline can coexist. Apple and Tesla are the weakest links in this specific decoupling story. Apple is still immense, but its current case is less about AI infrastructure and more about hardware-cycle durability and ecosystem monetization. Tesla, with a 282 times earnings multiple, is barely in the same valuation universe as the other six. It remains a story stock hiding inside a mega-cap wrapper. So no, the Mag 7 is not one trade anymore. And that may be the healthiest development of all. Is It Cheap? In aggregate, no. The Mag 7 is not "cheap" in the classic Cheap Investor sense. But parts of it are no longer priced for flawless perfection either. That is an important shift. Alphabet at 23.6 times earnings looks less demanding than many investors assume. Microsoft at 30.1 is expensive, but not absurd if AI monetization holds. Amazon at 30.6 still requires execution, though it is no longer priced like a moonshot. Nvidia at 45.6 is still premium territory. Meta at 31.5 sits in the middle. Apple at 34.4 reflects franchise quality but not obvious bargain status. Tesla is still a speculation disguised as a megacap. So the answer is not "buy the Mag 7." The answer is "stop treating them like a uniform blob." Bull, Base, Bear Bull case The broad market continues to widen while the Mag 7 keeps outgrowing the S&P 500 on earnings. AI capex begins showing clearer monetization through cloud, ad tools, enterprise software, and inference demand. In that world, the group benefits twice: lower concentration pressure and still-superior fundamentals. Reuters' forecasts for tech earnings growth of roughly 30% to 33% versus about 15% for the S&P support that possibility. Base case The correlation stays lower, sector rotation continues, and the Mag 7 becomes more selective. A few names keep winning, a few lag, and the group as a whole no longer dominates every up day in the index. That would still be constructive, because it means market leadership is healthier while Big Tech remains strategically central. Bear case The danger is not that decoupling itself is bad. The danger is that AI spending proves too front-loaded and the revenue payoff arrives too slowly. Reuters has already documented investor nerves over $600 billion-plus spending plans and doubts about whether the returns justify the outlays. If AI ROI disappoints while rates stay higher and oil-driven inflation persists, multiples can compress further even if the businesses remain strong. Action Plan for Tomorrow First, do not confuse decoupling with collapse. Second, stop thinking about "the Mag 7" as one position. Third, lean toward the names where earnings quality and valuation are most balanced. Today, that likely means looking hardest at Alphabet, Microsoft, and selected Amazon exposure, while treating Nvidia as higher-quality but less forgiving on price, Meta as execution-sensitive, Apple as steadier but less explosive, and Tesla as the most speculative by far. For investors building positions, this is a scale-in market, not a back-up-the-truck market. A simple framework would be: Start with a partial position in the Mag 7 names whose valuation still leaves room for error. Add only if earnings and AI monetization keep validating the spend. Avoid treating every market pullback as a reason to buy all seven. Cheap Investor Checklist Over the next quarter, watch these closely: Whether the negative correlation between the Mag 7 and equal-weight S&P persists. Whether technology still delivers the expected 30%-plus earnings growth in 2026. Whether AI capex plans stay near the $600 billion to $650 billion range or get cut back. Whether cloud growth and ad monetization begin to justify that spend, especially at Alphabet, Microsoft, Amazon, and Meta. Whether energy, financials, and industrials keep carrying more of the index. Whether Nvidia can keep premium valuation support while maintaining AI demand leadership. Whether Tesla's valuation remains defensible if autonomous optimism cools. Bottom Line The Magnificent 7's link to the broader market is breaking, and that is not automatically bearish. In fact, it may be exactly what Big Tech needed. A healthier market can carry itself more often. And that means the biggest technology franchises in the world no longer have to carry impossible expectations every single week. If this decoupling persists, the next phase of the cycle may not be "Mag 7 versus the market." It may be "which Mag 7 names deserve to keep leading when they no longer have to drag the whole index with them." Disclaimer: This editorial is for informational purposes only and should not be considered investment advice. Always conduct independent research before making financial decisions. IMPORTANT NOTICE AND DISCLAIMER Investing Media Solutions, LLC ("IMS"), the owner of this website (the "Website"), cannot guarantee the accuracy or completeness of the information contained in any article, email, newsletter, or other publication posted on or viewed in connection with this website (the "Publications"). The author or authors of those Publications are solely responsible for their contents. 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