The so-called “Magnificent Seven” – America's tech giants – have more financial power than almost any other major country in the world. According to CNBC, a new study by Deutsche Bank showed that the profits of Apple, Amazon, Alphabet (Google), Meta, Microsoft, Nvidia and Tesla exceed the profits of companies in almost all G20 countries.
Among the G20 countries, with the exception of the USA, only China and Japan can boast of higher returns on the shares of their companies.
Analysts at the bank noted that the combined market capitalization of the “Magnificent Seven” companies alone makes it the second-largest stock exchange in the world, more than twice that of Japan, which ranks fourth. Separately, Microsoft and Apple have the same market capitalization as all listed companies in France, Saudi Arabia and the UK combined.
These big tech giants benefited from interest in artificial intelligence, which created a real boom in 2023.
Risks
However, this large concentration of money in a few companies is causing concern among analysts. Some experts warn that such a large concentration could create risks for the American and global stock markets. They point out that when the market is so heavily weighted to a small number of stocks and one specific theme, now that AI is, there is a risk of missing out on investment opportunities.
As previously reported, technology companies have already laid off 34,000 workers since the beginning of 2024, focusing on the development of artificial intelligence.