These are the Herculean stocks holding up the S&P500: Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla.

Yet in recent months some of the best-known names among the group (MAG7) have stumbled—managing to rally back but leaving investors nonetheless questioning their slip in the first place, in the midst of a wider, uncertain macroeconomic cycle.

Elon Musk was reportedly left “almost in tears” during Tesla’s Q3 2023 earnings call, which wiped some $41 billion off his personal wealth.

With hiccups in the rollout of its much-anticipated full self-driving capabilities, as well as confirmation that its cyber truck will not hit the market any time soon, some investors are losing faith in a stock once seen as a license to print money.

Apple similarly raised eyebrows with its slowing revenue and lower iPhone sales, despite beating both top and bottom-line expectations for 2023.

Tom Forte, Senior Research Analyst at D.A. Davidson, highlighted to CNBC last month that the iPhone has been the foundation of Apple’s stock success for more than a decade.

To see its crowning jewel dulling in some metrics has led investors to question how gains will be made in the future.

Forte added investors should “absolutely” be nervous of Apple’s exposure to geopolitical tensions with China, as well as its reliance on Big Tech like Google.

Despite these hiccups, both stocks have roared back—leading a rally which boosted MAG7 by an estimated $200 billion in a single day on Tuesday.

It’s perhaps no surprise, then, that many analysts on Wall Street are determined these blips are not cracks appearing in the mega-cap cohort, but are par for the course—with the group leading the charge into a strong 2024.

Bullish for 2024

For JPMorgan, MAG7 represents “an important component of our more positive view on the overall market going forward.”

Abby Yoder, U.S. Equity Strategist at J.P. Morgan Private Bank, told Fortune JPMorgan is expecting a mid-year SPX target for 2024 of 4,700, adding: “The MAG7 have driven the market this year—that means both up and down.

“During the recent pullback from July 31 to Oct. 27, the MAG7 accounted for 25% of the drawdown, which was driven primarily by the companies within the MAG7 with more exposure to China given the ongoing economic slowdown and crackdown on various types of technology.

“That being said, the MAG7 still accounts for 83% of the market’s return [for the] year to date.”

Yoder continued that the path ahead for the MAG7 looks bright, with the majority of the companies moving through the worst of the earnings period into a Q4 of relatively more favorable growth comparisons.

“Most of these companies have already undertaken the majority of their cost cutting initiatives (i.e. layoffs),” Yoder explained, adding some of the MAG7 “are starting to see increased demand for their Cloud computing businesses, which sets them up nicely for marginal expansion into 2024.”

Yoder was echoed by Ed Clissold, chief U.S. strategist at independent investment experts Ned Davis Research (NDR). Clissold highlighted to Fortune that in years when the S&P 500 has risen overall but pulled back during the fall, a year-end rally ensues.

This happens for two reasons, he added: “First, investors sell losers for tax loss purposes. Second, momentum investors pile into the winners.”

Bargain buys

Yoder went as far as saying the pullback has created a “very attractive entry point” for the majority of the MAG7 names, outlining “many of them [are] trading in-line with or at a discount to the SPX.”

Likewise John Stoltzfus, Oppenheimer’s chief investment strategist, said MAG7 were “brutally and unjustifiably sold off” for most of 2022, adding: “The bear community sold off most tech stocks whether they were well established profitable companies or relative ‘newbie’ growth companies.”

That’s a far cry from the earlier outlook of staunch Wall Street bear Mike Wilson, Morgan Stanley’s chief investment officer. Back in February, Wilson said stocks had pushed into the “death zone” where “they shouldn’t go and cannot live very long.”

At the time he predicted a reckoning and readjustment in the market, but as the year draws to a close the MAG7 have only pushed higher along with the U.S. economy.  

America’s economic growth is one of the reasons Goldman Sachs senior strategist Ben Snider is so optimistic these stocks will push even higher. Snider told Fortune the U.S. economy remains “very healthy,” and predicted just a 15% chance of recession while the general consensus remains around a 50% likelihood.

“I would expect [MAG7] to continue to perform very well,” Snider echoed. “We have healthy economic growth, we have interest rates that are no longer [rising], and we have these companies that are generating very strong growth on an idiosyncratic basis—separate from their exposure to the economy. Those all suggests this should continue.”

Market power will out

Global tensions are high on the worry-list for most investors on Wall Street—with JPMorgan Chase CEO Jamie Dimon telling CNBC affiliate network CNBC TV-18: “We have dealt with inflation before, we dealt with deficits before, we have dealt with recessions before, and we haven’t really seen something like this pretty much since World War II.”

Elsewhere regulatory risks may also pose a threat—Alphabet CEO Sundar Pichai, for example, was summoned to federal court for the second time in two weeks to testify in an antitrust trial to defend the business practices of the Google Play Store, which distributes apps for the company’s Android software that powers most of the world’s smartphones.

While Goldman strategist Snider noted that the bank was conscious of geopolitical and regulatory risks, he dismissed such supply-side fears as “relatively concentrated,” explaining: “Broadly speaking part of the reason these companies have done so well is they have very elevated market power.

“As we’re seeing now in the U.S. court system that is being challenged in some cases by the U.S. government, and the outcomes of those trials could potentially affect whether these companies remain at the top of the market.

“But at its core we tend to focus mostly on economic growth, earnings growth, interest rate policy, these big picture macro drivers that usually drive stock performance.”

Stoltzfus points out that MAG7 businesses are also “deeply embedded in the lives of businesses and the consumer,” indirectly driving the market’s wider innovation and efficiencies.

As such, he continued: “In our view the stocks belonging to the  so-called ‘magnificent seven’ are likely to remain among the outperformers in the S&P 500 even as the rally broadens to include traditional cyclical companies belonging to other sectors such as consumer discretionary, industrials, financials, energy and health care.”

What’s the alternative?

Still, uncertainty is beginning to shine even among those with the best insight on Wall Street.

Last month Mohamed El-Erian, chief economic advisor at Allianz, parent company of Pimco, said he felt most comfortable keeping his fortune in cash and cash-like assets given current uncertainties.

Meanwhile billionaire investors Bill Ackman and Bill Gross have both u-turned on their positions on bonds—now betting on the relatively safe asset in order to combat against macroeconomic headwinds.

But when it comes to the MAG7, the experts Fortune spoke to disagree: even the entities which have defensive fallbacks aren’t tempted to utilize them just yet.

NDR has a ‘SHUT Index’ which compromising of “low beta” assets in consumer staples, healthcare, utilities, and telecom services—shares which tend to rise less in a market rally but are less volatile.

“The SHUT Index had its worst first year of a cyclical bull market on record, with data starting in 1972,” NDR’s Clifford revealed. “So even after accounting for their low-beta tendencies, they are extremely oversold. We are not recommending the SHUT Index yet, but if the market were to experience a choppy first half of 2024, they could outperform.”

Yoder outlined that JPMorgan finds the remaining S&P500 “compelling” in the current market, but said the bank’s “highest conviction” sector remains MAG7: “We do think they are going to drive the market over the short term as they recover, as well as over the longer term given their structural growth drivers, so exposure to both the equal weight and MAG7 makes sense in our view.”