Beyond the Magnificent Seven
By Simmons Investment Advisors on January 22, 2026
In 2023 and 2024, the majority of the return of the S&P 500 derived from the so-called “Magnificent Seven” stocks. This trend continued into 2025. There are signs, however, that the market may be broadening, and that stocks in different sectors, of different sizes, and of non-US domicile may be starting to play a little catch up. Consider the following chart from our friends at Strategas:
This chart (i) shows how in recent months while the largest technology stocks (Mag 8” in their formulation) have fallen, the rest of the market has done quite well. While Technology stocks outside of these largest ones have continued to do well, the last three months of 2025 were very good to financials, materials, and especially healthcare, a long-suffering sector of the market. Small stocks also had nice positive performance over the period, and indeed for a decent part of the year.
International stocks also had an excellent year. The MSCI All Country World Index ex US (ACWI ex US) returned 32% in 2025, versus 18% for the S&P 500. This is the first time that international stocks have outperformed the US since 2022 when both indexes had negative performance, and 2017 before that (ii) (iii).
The message to take away here is that the markets seem to be broadening and are not just being driven by the largest technology stocks anymore. This is positive for the markets and makes holding a well-diversified portfolio not only smart from a risk perspective, but also from a performance perspective.
As always, if you have questions on this or any other topics, please reach out.
Mike & Steve
DISCLOSURE: Sources include Strategas Research www.strategasrp.com as of January 14, 2026 (i), State Street www.statestreet.com as of December 31, 2025 (ii), and BlackRock www.blackrock.com as of December 31, 2025 (iii).
Simmons Investment Advisors is a group comprised of investment professionals registered with Hightower Advisors, LLC, an SEC registered investment adviser. Some investment professionals may also be registered with Hightower Securities, LLC (member FINRA and SIPC). Advisory services are offered through Hightower Advisors, LLC. Securities are offered through Hightower Securities, LLC.
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