Titans of Investing Make Magnificent Seven Moves
Whales are reshuffling their holdings as AI fatigue hits the mega-caps. Here's what to make of 13F filings from Buffett, Druckenmiller et al.
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Following a mixed session on Tuesday, there is a small rebound early on Wednesday as stocks struggle to digest problems in the AI sector and find support.
Fed minutes will be released on Wednesday afternoon, and later this week, there will be PCE inflation data. However, the recent market problems have more to do with AI's impact across industries and with how much return on investment hyperscalers will earn from their significant capital expenditures.
Seeking New Leadership
AI-related struggles are affecting the broader market as major players move to reposition funds. After years of Magnificent Seven and AI leadership, it is not an easy process to find new leaders who can be trusted to carry the market higher in the months ahead.
There has been some strong rotation into small-caps (IWM) , precious metals, energy, retailers like Walmart (WMT) , optical suppliers, and some financials such as Goldman Sachs (GS) , but there hasn’t been a new powerful theme like AI and the Magnificent Seven.
13F Filings Reveal Titan Shifts
There is still plenty of interest in the Mag 7, but not because of momentum and growth. Some names are seen as better values. Big investors such as Warren Buffett and Stanley Druckenmiller just filed their 13F filings, which show big moves they made in the Mag 7.
The most surprising move was Buffett's, who cut his Amazon (AMZN) position by 77%, leaving him with only about 2.2 million shares. He also reduced his Apple (AAPL) holdings but retained his Alphabet (GOOGL) position.
Druckenmiller made some aggressive Mag 7 buys in the fourth quarter. He increased his Alphabet position by 276% and his Amazon stake by about 70%. He exited his entire Microsoft (MSFT) position.
David Tepper of Appaloosa reduced his positions in Meta (META) and Nvidia (NVDA) .
Mag 7 YTD Performance Tracker
My Game Plan
The latest 13F filings cover the fourth quarter, and these investors may have made additional moves since then, but it is interesting to note the reshuffling within the group as these titans of investing try to pick the winners and losers as the AI theme matures.
My game plan continues to focus on individual stocks amid the difficult market environment. I’m poised to be aggressive with some buying, but I want to see better technical action in the overall market and development of sector themes.
It isn’t enough right now for a stock to be a good value. Many good values remain under pressure despite strong earnings and fundamentals. That will shift, but it will take better action in the overall market.
At the time of publication, Rev Shark was long META, GOOGL and NVDA.
