"Magnificent 7" Stocks Sold On 15 Of Past 17 Days Amid Massive Rotation Out Of Tech: Goldman Prime

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by Tyler Durden
Wednesday, Dec 06, 2023 - 03:25 AM

Over the weekend, when observing the multiple violent rotations taking place below the market's remarkably calm surface following November's frenzied breakout, we pointed one that stood out like a sore thumb: the rotation out of the "Magnificent 7" recent market darlings and into "trash" companies such as non-profitable tech. And even after a modest reversal in this trend today, one can still see just how out of favor the formerly most desired companies have become at the expense of some of the worst of the lot (the thinking is that the Fed slashing rates so fast it would imply the US is in a brutal recession in 2024 is somehow good for said "trash" companies).

Indeed, in his latest market comments, Goldman trader Michael Washington notes that price action today reflected a bit of reversion / consolidation of recent price action with NDX > RTY, mainly driven by AAPL +210bps having its biggest day of outperformance since early May, which felt like a combination of 1) broad based reversion higher in size factor, 2) better Foxconn numbers out of Taiwan, 3) AT&T made positive comments on Q4 wireless trends @ UBS TMT conf this AM, and 4) positive note from BofA. Goldman also saw passive Long Only demand in supercap tech after weakness yesterday, coupled with active buybacks among the Mag 7.