President Trump’s second inauguration in a chilly Washington seemed a cause for celebration among Silicon Valley’s elite.
The leading lights of Alphabet, Amazon, Apple, Microsoft, Meta Platforms, Nvidia and Tesla—all dubbed the “Magnificent Seven”—were prominently seated, lured by the president’s promise of deregulation and fresh merger opportunities.
Yet, barely 50 days later, the total market valuation of these seven technology heavyweights has plunged by around $2.7 trillion. The catalyst has been an unsettling combination of recession concerns, fuelled by Trump’s aggressive trade policies, a raft of government job cuts, and underwhelming economic data that revealed weaker-than-expected US job growth in February.
On Monday, the tech-heavy Nasdaq Composite closed down by 4 per cent in its biggest single-day drop since March 2020’s “Black Monday”, when the pandemic sent global markets into freefall. Until recently, investors had spoken freely of a “Trump put”—the assumption that the White House would step in to stem steep market losses—but those hopes are now fading, leaving the sector on shaky ground.
The fallout has been particularly harsh for some billionaire founders. Elon Musk of Tesla, Jeff Bezos of Amazon, and Google’s co-founder Sergey Brin have seen their collective wealth dive by more than $170 billion since the start of the year, according to a Bloomberg analysis. One notable exception is Mark Zuckerberg, the Meta Platforms boss, who has gained just over $4 billion in personal fortune during the same period.
Fresh trade conflicts have also weighed on sentiment, with the US imposing new tariffs on Canadian imports—a move that many see as a sign President Trump is doubling down on his combative approach rather than scaling back. Markets had banked on the administration steering away from further disruptions, but Jim Reid, head of macro research at Deutsche Bank, remarked: “That’s got the market very nervous that perhaps there isn’t a ‘Trump put’ in the way there was in the first term, or at least not yet.”
Compounding the turbulence is concern that the Magnificent Seven have become overvalued thanks to the widespread enthusiasm for artificial intelligence. Nvidia’s forward price-to-earnings ratio, for instance, surged to 32 times early this year before dropping to 23 following the sell-off. A broader retreat in optimism about AI—exacerbated by shock news from DeepSeek in late January—has only added to the pressure.
Tesla has been hit the hardest, shedding $652 billion in market value as slowing demand in China and Europe coincides with a backlash against Musk’s close ties to the White House. For some embattled investors, the hope now is that President Trump backtracks on his more aggressive policies, allowing for a “relief rally” in US equities. Until then, analysts expect the fortunes of the Magnificent Seven—and their billionaire founders—to remain volatile.
