Amazon’s Stock Decline Highlights Divergence in Magnificent 7 Performance

Amazon's shares tumbled more than 7% Friday, dragging down the Roundhill Magnificent 7 ETF as investors reacted to what they perceived as disappointing earnings. The tech giant's underperformance stood in stark contrast to Microsoft and other megacap peers, which showed relative resilience despite broader market pressures.

Two macroeconomic shocks disrupted an otherwise strong earnings week: the TRUMP administration's new tariff plan targeting trade-imbalanced nations, and a weaker-than-expected jobs report. These developments prompted traders to increase bets on a September rate cut—a potential tailwind for big tech valuations moving forward.

While Amazon bore the brunt of selling pressure, the rest of the Magnificent 7 cohort—including Nvidia, Apple, and Meta Platforms—demonstrated more moderate declines. The divergence highlights how market participants are increasingly discriminating between tech leaders based on execution quality and growth visibility.