Last year,$S&P 500 Index (.SPX.US)$It has soared by 23%, more than half of which is driven by the rapidly advancing technology giants. As profit growth slows down, these giants are likely to struggle to dominate the market by 2025.

Lisa Shalett, Chief Investment Officer of Morgan Stanley Wealth Management, stated in an interview on Thursday that the profit slowdown "may surprise some stubborn individuals betting on double-digit high returns," and that the idea of them as a group being able to Trade and lead the market may be shaken in 2025. She noted that some of the earnings expectations in the stock prices "may be overly ambitious."

According to data compiled by Bloomberg Intelligence, the 'seven giants' of USA technology ($MAGNIFICENT (00201.HK)$ Seven, which is $Alphabet-C (GOOG.US)$ Parent company Alphabet Inc.,$Amazon (AMZN.US)$、 $Apple (AAPL.US)$ 、$Meta Platforms (META.US)$ 、$Microsoft (MSFT.US)$、$NVIDIA (NVDA.US)$and$Tesla (TSLA.US)$The profit growth rate is expected to be 18% this year, lower than the projected 34% for 2024.

This may explain why investors are becoming increasingly wary of these large Technology stocks. The total return index for the 'Magnificent Seven' tracked by Bloomberg is set to decline at least 1% for the fourth consecutive Trading day, marking the longest streak of declines since 2022. The index has never fallen consecutively for five days by 1% or more.

Shalett anticipates that traders will be more selective when purchasing giant Technology stocks in 2025, starting to distinguish between different stocks in order to pick winners. She said, "We are entering a phase of a cycle where the differences in risks faced by individual companies will truly matter, whether we are talking about the varying risks posed by the AI growth story itself or the antitrust risks, and recently we have had to discuss the risks brought about by the very strong dollar."

Among the professionals on Wall Street, it is not just Sharlot who believes that the dominance of the "seven giants" will eventually come to an end. At Bank of America, Savita Subramanian warns that expectations for the giants' growth are nearing historical highs, which is precisely when their profits are expected to slow down. Companies like Goldman Sachs and Citibank are urging clients to diversify investments outside of the tech giants.

Sharlot believes that the key to 2025 lies in having "realistic expectations" and "picking stocks" among other stocks in the S&P 500 Index.

She said: "I think we need to pay attention to the fact that some disappointing areas may emerge. Our best guess is that disappointment will surface in some of the areas that have the most enthusiasm."

Editor/Rocky