This round of fixes validated the forward-looking assessment for Q2, prioritizing repairs into three categories following a "layer first, then expand" approach.
Written by DaiDai, Frank, MSX Maetong
In 15 days, the Nasdaq experienced a dramatic rollercoaster.
At the end of March, there was still significant divergence in the market regarding the Magnificent Seven, with high valuation pressures yet to be fully unwound, and capital found it difficult to truly move away from core technology stocks; by April 15, the Nasdaq Composite Index had risen for 11 consecutive trading days, breaking the longest winning streak since November 2021, while the S&P 500 also reached a new all-time high.
If you look only at the index, this appears to be a familiar tech stock rebound story, but a closer look reveals that the rally is driven by far more than just tech stocks themselves—expectations of easing tensions in the Middle East, lower-than-expected PPI data, and stronger-than-anticipated earnings in the early stages of earnings season are all contributing simultaneously. In other words, this is not merely a sentiment-driven rally, but rather a synchronized occurrence of index recovery, rising risk appetite, and repricing of earnings expectations.
More notably, the internal trends among the Seven Sisters are not aligned: some have already returned to their trends, others are catching up, while some still haven’t established a clear direction. MSX previously anticipated in its Q2 outlook that the Seven Sisters would not necessarily rebound together, and that a sequential recovery is more likely (see extended reading: “Oil Surges, Rates Stay High, Seven Sisters Stall: What Are the Key Drivers for Q2 Outperformance in U.S. Equities?”), breaking them down into three tiers: Alphabet (GOOGL.M), Amazon (AMZN.M), and NVIDIA (NVDA.M) are the top candidates for early recovery; Microsoft (MSFT.M), Apple (AAPL.M), and Meta (META.M) are better suited for continued monitoring; Tesla (TSLA.M) remains highly volatile and strongly event-driven.
This judgment seemed restrained at the time, even lacking a strong point of view.
But now, what the market has played out is precisely this rhythm of "layering first, then expanding."
First, which batch returns first, and why?
Back at the end of March, there was significant divergence in the market regarding the Seven Sisters.
On one side, there was lingering concern over unrelieved high valuation pressures; on the other, the reality that capital struggled to truly distance itself from core technology assets. At the time, the most concentrated discussion was whether "big tech would return," but in hindsight, the question itself was too simplistic. The real issue was never whether it would return, but who would return first and why.
And today, half a month later, the answer has already written itself on the chart.
From the end of March to April 15, Alphabet (GOOGL.M), Amazon (AMZN.M), Meta (META.M), and NVIDIA (NVDA.M) led the gains, followed by Microsoft (MSFT.M) and Apple (AAPL.M), while Tesla (TSLA.M) lagged significantly, further confirming that this was not a synchronized rally, but rather a differentiated recovery and realignment.
Among the first group to be repaired, Alphabet (GOOGL.M), Amazon (AMZN.M), and NVIDIA (NVDA.M) each have different rationales, but share one common trait: they were the first to restore market confidence that investment can still yield growth:
- The repair logic for Alphabet (GOOGL.M) is the clearest: the cash flow resilience of its core advertising business provides a valuation floor, while AI integration into search and cloud services has shown the market a continuation of its growth narrative—gaining back investors' trust primarily through verifiable fundamentals;
- NVIDIA's (NVDA.M) position requires little explanation: as long as AI remains the central theme of this tech cycle, NVIDIA will remain the most critical anchor. The market’s debate about it has never been about “whether AI needs computing power,” but rather “how long this growth rate can be sustained.” Therefore, at least for now, both cloud providers’ capital expenditure plans and demand signals from training and inference continue to support its recovery narrative;
- The changes at Amazon (AMZN.M) are particularly worth examining separately: during this cycle, market patience with Amazon was not among the highest, as concerns over slowing e-commerce growth persisted and competitive pressures on AWS remained unchanged. However, as the profitability of its cloud business continued to improve, AI-related capital expenditures began translating into tangible revenue signals, and the overall profit realization narrative was gradually reaccepted, Amazon entered its recovery phase earlier than many anticipated. Thus, its rebound was not driven by a single catalyst, but rather by multiple factors simultaneously reaching the threshold at which the market was willing to reprice it;
In other words, the assets that are first revalued by the market aren't necessarily the most "stable," but rather those that convince capital earlier that further investment can still generate growth and that recovery can continue along the trend.
Who gets repaired first or second in this round of the Seven Sisters is not fundamentally about who has stronger emotions, but who regains the right to explain first.
Two, the spread is widening rather than narrowing
More notably, this round of fixes did not stop at just the first batch of names.
Microsoft (MSFT.M), Apple (AAPL.M), and Meta (META.M), which were originally better suited for the watchlist, have now clearly caught up. In other words, the market isn’t just moving on the first few to break out—it’s continuing to spread to the next layer after confirming the initial recovery phase.
This is actually crucial. If this were merely a short-term sentiment rebound, the market would typically show a rougher pattern: a sharp rally followed by an equal swift pullback, with limited speed and sustainability. But that’s not what we’re seeing now. Instead, the market appears to be undergoing a top-down recovery, with capital first returning to core assets, then further sorting within those core assets. Those whose earnings can justify their valuations, and whose investments continue to align with growth, remain in the recovery sequence; those merely riding the sentiment wave will fall behind as the market diverges.
Precisely for this reason, the Seven Sisters' current rally resembles a "sequential rollout" rather than a "group return together."
A more significant signal is that this recovery has not been limited to just the first batch of names.
Microsoft (MSFT.M), Apple (AAPL.M), and Meta (META.M), which were originally better suited for the watchlist, have now clearly caught up—meaning the market isn’t limited to just the first few movers and then stopping; instead, after confirming the initial recovery phase, it continues to spread to the next layer.
The significance of this goes beyond what meets the eye. If this were merely a short-term sentiment rebound, the market would typically show a more chaotic pattern: a sharp rally followed by an equally swift pullback, with limited duration and momentum. But the current structure clearly isn’t like that—it resembles a market-wide recovery first, followed by capital flowing back into core assets, and then further ranking within those core assets.
That means those whose performance can justify their valuation and whose investments continue to align with growth will remain in the recovery sequence; those who are merely following sentiment will fall behind in the divergence.
This is why this market cycle is more like a "repair and diffusion" rather than a "rebound conclusion," causing the Seven Sisters not to surge together and then quickly fade, but instead to first repair the first group, then expand to the second group, and continue filtering which ones can remain in the trend during the diffusion process.
Objectively, this structure itself indicates that the market is re-pricing core assets in a more patient manner.
However, it must be noted that Tesla (TSLA.M) remains the most unique variable in this ranking.
It is certainly elastic and has garnered significant market attention. However, so far, Tesla still behaves more like a highly volatile, event-driven asset rather than a core position that has firmly returned to a trend-recovery sequence. The market’s pricing of Tesla is often based more on speculative trading and event-driven factors—such as advancements in autonomous driving regulations, Robotaxi timelines, and Elon Musk’s public statements—rather than consistent profit realization.
This doesn't mean Tesla lacks trading value—in fact, its volatility itself is a trading opportunity. But its presence clearly shows that the seven sisters are not returning in unison; some have already re-entered the trend, others are catching up, and some still remain on the edge of the trend. Labeling this cycle as a "full-group return" is too simplistic—it's more accurate to understand it as a "divergence in the order of recovery," which better reflects the actual market dynamics.
III. How far can this round of recovery go?
At this point, what’s more worth discussing is not whether “this rally has gone too far,” but whether “there’s still a foundation for this recovery to continue.”
From an institutional perspective, the outlook is largely positive. The BlackRock Investment Institute has upgraded its U.S. equity stance from neutral to overweight, citing, among other reasons, the resilience of corporate earnings, particularly in technology; Citigroup has also upgraded U.S. equities to overweight. The expected earnings growth rate for the S&P 500 in Q1 has been revised up from 12.7% to 13.9% since before the Middle East conflict. This suggests that the rally is supported not only by improved risk appetite but, more importantly, by the fact that earnings expectations themselves have not deteriorated.
This point is especially critical for the repair trajectory of the Seven Sisters. Because this round of repair logic is not built on sentiment or liquidity-driven factors, but rather on the fundamental assessment of whether core technology companies can still deliver on their earnings. Continued upward revisions to earnings expectations mean the foundation for the repair remains intact, providing room for both the first wave of stocks that have already been repaired and the second wave currently following suit to continue trending upward.
Of course, the variables have not disappeared. The IMF has already lowered its global growth outlook due to the Middle East conflict and rising energy prices, warning that if the conflict drags on and oil prices remain high, the global economy could approach an adverse scenario. In other words, the biggest disruption to this rally may not come from within the Seven Sisters’ internal logic, but rather from external macro factors—oil prices, inflation, and geopolitics.
But so far, the market’s response has been largely positive: indices are recovering first, with core technology sectors repairing in layers, spreading outward only after the initial groups have stabilized—rather than surging all at once and quickly fading. As long as the market continues to follow this structure, this cycle feels more like an ongoing process than a story nearing its end.
In conclusion
The fact that the Nasdaq has risen for 10 consecutive days means more than just how long the index has been climbing.
It more closely resembles the market answering, through its own price action, the most hotly debated question at the end of March: Will the Magnificent Seven return as a group, or will they first establish a hierarchy?
The answer is now clear.
To be honest, the market never lacks retrospectives or post-event analyses. What’s truly scarce is someone who, amid the greatest分歧, can first identify the key points. That March-end Q2 outlook did not chase a more sensational or easily digestible conclusion; instead, it placed the most critical elements of this rally front and center: the Seven Sisters won’t all return together, the market will first determine the order of recovery, and what ultimately determines the upside isn’t who surged fastest in the first wave, but who can maintain their position through subsequent earnings, trends, and risk appetite.
Ultimately, whether it’s the divergence in earnings season or a new wave of diffusion beyond core technologies, what truly matters are the judgments that clarify the market’s key focus earlier—rather than crafting a seemingly logical explanation after the trend has already played out.
Before the next turning point arrives, let’s continue to identify the key market highlights and act with purpose.
Let's encourage each other.
Source:Show originalDisclaimer: The information on this page may have been obtained from third parties and does not necessarily reflect the views or opinions of KuCoin. This content is provided for general informational purposes only, without any representation or warranty of any kind, nor shall it be construed as financial or investment advice. KuCoin shall not be liable for any errors or omissions, or for any outcomes resulting from the use of this information.Investments in digital assets can be risky. Please carefully evaluate the risks of a product and your risk tolerance based on your own financial circumstances. For more information, please refer to our Terms of Use and Risk Disclosure.