00:00Ed Yardeni of Yardeni Research writing, this has been a less strong earnings season for the Mag7
00:04as their CapEx guidance has soared and their earnings growth has slowed from torrid paces.
00:09Ed joins us now for more. Ed, welcome to the program.
00:11What is it going to take to get big tech in America out of this penalty box?
00:16Well, I think right now it's going to stay there for a bit because we've got what I call AI
00:23derangement syndrome.
00:25We've all gone from a situation where AI is all good, productivity enhancing, good for profits, good for the economy,
00:34to suddenly kind of a Frankenstein monster that's going to devour us.
00:39And I think that kind of extreme mood swing isn't going to last terribly long, but it could last through
00:46the middle of the year.
00:47And meanwhile, we have seen this beginnings of a great rotation into foreign markets, as you pointed out.
00:55We've seen a great rotation into sectors of the S&P 500 that certainly lagged behind during the rally we've
01:03had.
01:03So this is, I think, kind of a healthy repricing of valuation.
01:10Remember, there are all these concerns about how the market was too concentrated and that when these MAG-7s were
01:17going to start to underperform,
01:20that the whole market would underperform, we'd get a better market.
01:23That's not happening.
01:24This is a pretty healthy rebalancing, the way I see it.
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