Citigroup Says Magnificent 7 Era Ended; ETF Up 1% YTD vs S&P 500 at 9%

According to Citigroup strategists, the era of the 'Magnificent 7' large-cap technology stocks has ended today, as the Roundhill Magnificent 7 ETF has risen only 1% year-to-date, underperforming the S&P 500's 9% gain. The strategists noted in a client note that the Magnificent 7, which dominated markets since the AI boom began in late 2022, has recently underperformed due to valuation concerns and uncertainty around capital spending and AI tool adoption.

Microsoft posted the worst performance among the group, declining 17% this year amid concerns over massive AI infrastructure investments. Citigroup highlighted that companies outside the Magnificent 7 have driven much of 2026's S&P 500 gains, with a weighted index of the top 25 contributors generating 7% returns—outpacing the Magnificent 7's 2% rise.