Retail Investors Slash Magnificent Seven Trading Ahead of Microsoft Earnings

Retail investors are aggressively pulling back from trading Microsoft Corp and other Magnificent Seven stocks ahead of first-quarter earnings, with their share of volumes dropping to just 11% last week per Citi data. This marks a decline from 15% in October to as low as 7.5% recently, amid a 26% drop in total volumes and net put-heavy zero-day options positioning signaling downside hedging. The retreat favors defensive sectors, potentially shielding individuals from falls but causing them to miss rallies, while the group's 25.8% S&P 500 weight keeps earnings pivotal for broader markets.