markets

Luke Kawa3/18/25

The Magnificent 7 are finally acting as a group — besides Apple, they’re all tumbling together

Well, perhaps there’s one reason to continue to refer to the Magnificent 7 as an amorphous collective after all. And it’s a bad news story: with the exception of Apple, the group of stocks is trading like a cohesive unit. By falling, a lot.

2024 was a year defined by the ability of these megacap tech companies to trade largely independently of one another, even as most were getting more and more levered to the AI theme, either through sales or capex.

The correlation disinflation between these trillion-dollar companies was one of the most critical factors in keeping overall stock market volatility compressed. That’s gone out the window.

We’ve seen that turn on a dime from the S&P 500’s record highs until now. At the time of the benchmark US stock index’s closing peak, the average correlation between members of the Magnificent 7 over the trailing month was its lowest since 2021. That has since exploded during a market rout that’s been principally characterized by a breakdown in high-flying momentum stocks, especially those tied to AI.

In a crisis, as they say, correlations go to one.

Apple, with just a 34% correlation to the other members of the cohort over the past 21 sessions, is playing the biggest role as a volatility dampener at the moment. But the world’s biggest publicly traded company is just a sandbag in the face of a tsunami at the moment.

Meta, Alphabet, and Amazon all hit fresh 2025 lows this morning.

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Tasha Matsumoto

Stocks rebound as tariff fears ease

Stocks clawed back some, but not all, of Friday’s losses after Trump signaled softening in his China stance.

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String of acquisitions fuel biotech optimism

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J. Edward Moreno3h

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Micron jumps after rare double upgrade by BNP Paribas Exane, which lifts price target to Street high of $270

Micron, the best-performing member of the VanEck Semiconductor ETF this year, is jumping on Monday thanks to converting its biggest doubter on Wall Street into its biggest fan.

BNP Paribas Exane analyst Karl Ackerman went through with a rare double upgrade of the memory chip specialist to “outperform” from “underperform.” In the process, he more than doubled his price target on the stock to $270 — the highest among analysts surveyed by Bloomberg — from $100, which had previously been the lowest price target on the Street.

“We now fully embrace high-bandwidth memory (HBM) as a sustainable, separate growth vector, and we beleive we are in the early innings of a memory supercycle,” he wrote.

Separately, analysts at Evercore ISI also boosted their price target on Micron to $137 from $100.

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IonQ soars after announcing “significant advancement in quantum chemistry simulations”

IonQ is ripping higher in early trading after the quantum computing company announced “a significant advancement in quantum chemistry simulations.”

In particular, this demonstration, performed in collaboration with a major automotive manufacturer, was more accurate than classical computing in calculating “nuclear forces at critical points where big changes occur.”

Knowing how different compounds behave and respond to force has potentially very useful commercial applications because it helps us discern how those materials can best be designed and utilized for different purposes.

“This research demonstrates a clear path for quantum computing to enhance chemical simulations that are foundational to decarbonization technologies,” said Niccolo de Masi, chairman and CEO. “Our work goes beyond academic benchmarks. It demonstrates a practical capability that can be integrated into molecular dynamics workflows used across pharmaceuticals, battery, and chemical industries.”

IonQ is the most commercially advanced pure-play quantum computing company, generating over $52 million in revenues over the past 12 months, well more than D-Wave Quantum, Rigetti Computing, and Quantum Computing combined.

Now, is this the reason why IonQ (and its peers) are on a tear today? Maybe. There’s a big rebound in most speculative pockets of the market after Friday’s tariff threat induced a tumble.

At the very least, this is a useful excuse. Traders have been exceedingly happy to bid up shares of quantum computing companies on their long-term potential, often (ironically) through short-term call options.

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Matt Phillips6h

Rocket Lab may be “alternative to SpaceX in the making,” says Morgan Stanley

Rocket Lab surged early Monday after Morgan Stanley analysts lifted their price target on the stock to $68 from $20, making them the high bidder among analysts covering the popular, but still money-losing, commercial space launch company.

The $68 target — right around where the shares are currently trading — is the highest among the 17 analysts tracked by FactSet.

And while Morgan Stanley analysts couldn’t bring themselves to upgrade the stock to a “buy,” leaving their rating at “equal weight,” they gave the stock a pretty bullish review, writing:

“We see a potential alternative to SpaceX in the making. The company is mirroring SpaceX’s footsteps in a number of respects, including scaling up rocket lift capacity, embracing booster reusability, and ultimately moving out on a constellation of its own (ala Starlink). Meanwhile, successive Electron launches and a growing manifest reinforce the company’s already-impressive track record. The market, in our view, is now taking valuation cues for RKLB from SpaceX’s implied valuation, which has grown from a reported ~$100bn at the end of 2021 to ~$400bn today.”

Rocket Lab shares have emerged as a favorite of retail traders this year, thanks to their gain of more than 150%. The stock is up roughly 600% over the last 12 months.

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