By Emily Bary
Meta and Microsoft shares have struggled for momentum over the past three months but rode improving market sentiment this week
Shares of Meta and Microsoft, led by Mark Zuckerberg and Satya Nadella, respectively, staged resurgent performances this week.
During a big week for Big Tech, Meta Platforms and Microsoft shares notched their largest weekly gains in over six months. Is sentiment meaningfully flipping for those beaten-down plays?
The rallies in Meta (META) and Microsoft (MSFT) came as the broad-market mood improved, reflecting investors’ growing expectation that the Federal Reserve will cut interest rates at its December meeting. A rate cut is seen as favorable for technology stocks, and especially for the artificial-intelligence trade. The Nasdaq Composite Index COMP closed the week 4.9% higher, while the S&P 500 SPX climbed 3.7%.
Meta’s stock advanced 9% on the week to seal its best weekly performance since May 2. The week’s gain snapped a stretch of four consecutive weekly declines and outperformed Alphabet’s stock (GOOG) (GOOGL), the new market darling.
See also: These two ‘Magnificent Seven’ stocks could be the strongest survivors of an AI apocalypse
Meanwhile, Microsoft’s 4.2% rise was enough for its strongest weekly performance since May 2, as well. Within the “Magnificent Seven” grouping of large technology stocks, all but Nvidia (NVDA) landed in positive territory for the week. Tesla’s stock (TSLA) was the biggest gainer, up 10%.
The Roundhill Magnificent Seven ETF MAGS staged a 5.2% rise on the week, snapping a streak of three consecutive weekly drops. But Citi analysts noted Monday that the “Magnificent Seven” have started to behave less like a monolithic group lately.
Meta and Microsoft shares have generally struggled for momentum in recent months, with Meta off 13.7% over a three-month span and Microsoft down 3.5%.
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In the aftermath of Meta’s third-quarter earnings report, investors began to more heavily scrutinize the company’s heightened artificial-intelligence spending given what’s seen to be a murky path to monetization. Whereas Microsoft, Amazon.com (AMZN) and Alphabet have cloud businesses that can financially benefit from the AI boom, Meta doesn’t. The company says that AI has helped it improve creative tools for advertisers and content recommendations for users, but Wall Street isn’t sure that other bets, like a chatbot, will pay off.
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BNP Paribas analyst Nick Jones, who initiated coverage of Meta shares with a bullish rating earlier this week, agreed that success in large language models looks far from certain but praised the company’s monetization potential beyond that.
Read: Meta’s stock finds a new defender, who predicts 30% upside from here
Microsoft’s stock pressure has been somewhat more puzzling for Wall Street analysts, though they’ve come up with some theories, many of which relate to close partner OpenAI. First investors were worried that OpenAI would diversify away from Microsoft, but lately the concern has been that OpenAI might not even be the future of artificial intelligence, as Alphabet’s efforts gain steam.
In a volatile year, shares of Microsoft are now up 16.7% on a year-to-date basis, a performance that ranks third within the “Magnificent Seven” and is roughly in line with the S&P 500’s 16.5% gain. And shares of Meta, which as recently as last week flirted with a wipeout of all their 2025 gains, are now ahead 10.7% on the year.
-Emily Bary
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11-28-25 1316ET
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