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“Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful.” – Bela Karolyi
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In today’s world, “The Magnificent 7” often refers to the tech giants Microsoft, Apple, Nvidia, Alphabet (Google), Amazon, Meta Platforms (Facebook), and Tesla. However, the original “Mag 7” were a different kind of legend, made up of Borden, Chow, Dawes, Miller, Moceanu, Phelps, and Strug. These were the seven women of the 1996 US Women’s Gymnastics Team, led by coaches Martha and Bela Karolyi. The August 13, 1984 cover of Sports Illustrated had a picture of Mary Lou Retton with the caption, “Only You, Mary Lou”, but the 1996 Women’s Olympics gymnastics team was stacked with a deep roster of talent and high hopes of winning the gold- something never done before in US women’s gymnastics history.
Battling it out with Russia and Romania, on July 23, 1996, it all came down to the vault, and the US needed a solid score to clinch the gold. First up for the US, Dominque Moceanu slipped on each of her vault attempts leaving it to Kerri Strug. On her first attempt, Strug also slipped and ‘heard something snap’ as she fell to the mat wincing in pain. Despite the burning in her ankle, Strug swallowed the sting and gathered herself at the start of the mat. Strug sprinted down the 75-foot runway, launching into a round-off back handspring onto the vault before soaring into a one-and-a-half twist. Coming back down from orbit, she stuck the landing (on one foot) and turned towards the judges to finish the routine. Not a second later, she collapsed to the mat and crawled off the mat in agony.
Strug scored a 9.712 which was enough for gold. The picture of Bela Karolyi carrying Strug to the medal stand because she couldn’t walk has become one of the most memorable pictures in Summer Olympics history. Nearly as iconic is the picture of each of the original Mag 7 standing on the gold medal platform in their warmup suits…except for Strug in the second from the right position who couldn’t get the pants over her brace.
Alphabet (GOOGL) and Tesla (TSLA) will kick off earnings season for the tech-heavy stock market Magnificent 7 after the close today. Heading into the reporting period, the last several days haven’t seen a gold market performance from any of them, as they’ve all stumbled to varying degrees in the last week. Apple (AAPL) and Amazon.com (AMZN) have both seen declines of at least 4%, while Nvidia (NVDA) isn’t far behind with a decline of 3.8%. The only one of the seven not down more than 1% during this span is TSLA, but it’s also up the least YTD with a gain of 1.22%. Outside of TSLA, the other Mag 7 stocks remain up at least 15% YTD while GOOGL and Meta Platforms (META) hold on to gains of over 30% and Nvidia (NVDA) leaves the rest of them in the dust with a YTD gain of nearly 150%.
Relative to their trading ranges, AMZN and META have broken below their 50-DMAs which would be viewed negatively in the short term from a technical perspective. Meanwhile, AAPL and TSLA have remained at overbought levels bucking the trend of the rest of the group and the broader market. The fact that these stocks have experienced weakness leading up to their earnings reports isn’t necessarily such a bad thing as rallies into earnings would only have the potential to set the bar unrealistically high. It doesn’t take a gymnast to know that the lower the bar, the easier it is to get over it.
Looking at the charts of each Mag 7 stock, even after their recent pullbacks, they mostly all remain in uptrends of varying degrees of steepness. While TSLA may not be in an uptrend, it’s still more than 25% above its 50-day moving average even as it deals with resistance from its late 2023 peak.
