Google shares tumbled 11% in June, contributing to the MAG Seven’s $2.8 trillion market cap loss and outpacing Nvidia’s 9% decline. With Big Tech’s capex-to-free cash flow ratio at 98% and recent debt and equity issuances straining valuations, upside may be limited without broader market catalysts.
Google shares fell 11% in June, underperforming alongside its FAANG peers as Nvidia dropped 9% and Amazon slid 14%, driving the combined MAG Seven market capitalization down by $2.8 trillion.
The group’s capex-to-free cash flow ratio has climbed to 98%, forcing recent debt issuances that markets may struggle to absorb and prompting equity offerings that underscore stretched balance sheets.
Historical data point to a tech rebound in the final three days of June and first 12 days of July, but high valuations and the world’s most crowded trade suggest any bounce could be short-lived.
Falling oil and gas prices are boosting disposable income, with consumer discretionary and staples posting strongest relative performance versus the S&P since 2013 and 1998 respectively, hinting at a rotation away from crowded tech positions.
