After Trillions in Market Value Evaporate, Tech Giants’ Stocks Remain Stable

Key Points

1. After experiencing a market value evaporation of over $1 trillion in a single week, tech giant stocks held steady in pre-market trading on Monday, kicking off a new trading week.
2. In early pre-market trading, Oracle and Microsoft edged higher, while Meta, Alphabet, Amazon, and Nvidia saw slight declines.
3. Amid the AI boom, major companies have announced massive capital expenditure plans for 2026, sparking market concerns.

After a sharp decline that wiped out over $1 trillion in market value in a single week, tech giant stocks remained stable in Monday’s pre-market trading.

As of 6:40 a.m. Eastern Time, Oracle shares were up 1.6%, Microsoft edged up 0.8%; Meta fell 0.2%, Amazon was flat; Alphabet dropped 0.5%, and Nvidia, after rebounding 7.9% on Friday, pulled back about 0.9%.

Last week, when tech giants released their earnings reports, they all raised capital expenditure forecasts and ramped up their AI investments, a trend that has heightened market anxiety.

Amazon, Alphabet, Microsoft, and Meta disclosed that in just the fourth quarter of last year, their combined capital expenditures reached about $120 billion; by 2026, this figure could approach $700 billion—surpassing the GDPs of countries like the UAE, Singapore, and Israel.

Jim Reid, Global Head of Macro Research at Deutsche Bank, wrote in a Monday report that last week was the worst weekly performance for the "Magnificent Seven" since April last year—when US tariff hikes triggered a market crisis and the sector plunged 4.66%.

Reid pointed out that signs of recovery appeared at market close last week. Even though Amazon tumbled 5.55%, the "Magnificent Seven" as a whole still rose 0.45% on Friday.

Justin Post, a research analyst at Bank of America Securities, said in a Monday report that although cloud companies’ profit margins continue to improve under macro pressures, their stock prices face “potential volatility risks.”

He added: “However, management teams seem very confident in their ability to forecast demand, and believe 2026’s computing capacity will be fully utilized.”

David Lefkowitz, Chief Investment Officer for US Equities at UBS Financial Services, said last Friday that the capital expenditure guidance from Amazon and Alphabet “far exceeded” market expectations, and the market reacted negatively, which “overshadowed the above-expectation growth in both companies’ cloud businesses.”

Nvidia CEO Jensen Huang said on CNBC’s "Midday Report" last Friday that current demand for computing power remains “very high,” and it is reasonable for the tech industry to invest heavily in AI infrastructure.

Analysts predict there is still room for growth in capital expenditures among hyperscale cloud service providers.

Morgan Stanley said in a Monday morning report: “As the number of tokens processed per month grows exponentially, total cloud revenue growth for Google Cloud, Amazon Web Services, and Microsoft Azure continues to accelerate, with increasing commitments to data center investments. Data center component suppliers have also indicated that demand is accelerating. We believe capital expenditure expectations for hyperscale cloud service providers will continue to face upward revisions.”

Editor: Guo Mingyu