The relentless rally in mega-cap tech is reviving memories of the dot-com bubble, as the Magnificent Seven continue to swell in value, leaving traditionally defensive sectors like healthcare in the dust.
The group of tech giants known as the Magnificent Seven — Nvidia Corp. (NASDAQ:NVDA), Apple Inc. (NASDAQ:AAPL), Microsoft Corp. (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOGL), Amazon.com Inc. (NASDAQ:AMZN), Meta Platforms Inc. (NASDAQ:META) and Tesla Inc. (NASDAQ:TSLA) — has now reached a combined market capitalization of nearly $21 trillion, setting a new record as of September 2025.
This number isn’t just staggering — it’s historic. These seven companies alone are now worth four times more than the combined market cap of the 60 largest healthcare stocks in the U.S., highlighting a sharp shift in investor preference toward artificial intelligence, cloud computing and digital platforms over pharmaceuticals, biotech, and medical devices.
Nvidia's Size Tells The Whole Story
Nvidia’s valuation has ballooned to a point where it is now over six times the size of the largest U.S. healthcare stock, Eli Lilly & Co. (NYSE:LLY), which has itself had an impressive run over the past two years.
Even more dramatic: Nvidia is nearly twice as valuable as the combined market cap of the seven largest U.S. healthcare companies, which include Eli Lilly & Co., Johnson & Johnson (NYSE:JNJ), AbbVie Inc. (NYSE:ABBV), UnitedHealth Group Inc. (NYSE:UNH), Abbott Laboratories (NYSE:ABT), Merck & Co. Inc. (NYSE:MRK) and Thermo Fisher Scientific Inc. (NYSE:TMO).
Altogether, the Magnificent 7 are worth about eight times more than the entire group of the leading seven healthcare players.
A Ratio Not Seen Since The Dot-Com Peak
But the most telling data point is this: the ratio of the Technology Select Sector SPDR Fund (NYSE:XLK) to the Health Care Select Sector SPDR Fund (NYSE:XLV) has reached levels last seen in March 2000 — the very peak of the dot-com bubble.
Over the past six months alone, tech stocks have outperformed healthcare by 40%, marking the largest outperformance of tech versus healthcare in a six-month window.
What Could Come Next Might Surprise
If the market continues to climb, tech could continue to maintain its lead; however, history offers a cautionary tale.
Between March 2000 and September 2002, as the dot-com bubble unraveled, the tech-to-healthcare ratio dropped by 80%, wiping out trillions in market value from overvalued tech names. Many retail and institutional portfolios were caught off guard by the speed and depth of the reversal.
While today’s tech companies have stronger earnings and more durable business models than their dot-com predecessors, the valuation gap between tech and the rest of the market — particularly defensive sectors like healthcare — is now echoing a historic precedent.
The question isn't whether tech is dominant — it clearly is. The question is how much longer this kind of sector concentration can last before the market demands balance again.
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