What this chart is really showing is a change in market leadership under the hood.
For the last two years, the Magnificent 7 carried the earnings story. In 2023, their profit growth was running at 35 percent while the rest of the S&P 493 was basically flat. In 2024, that gap stayed huge, with Mag 7 still growing at 36.8 percent versus just 6.9 percent for the broader market. That kind of spread explains why the market felt so narrow. A small group of mega-cap names was doing the heavy lifting, and investors were willing to pay a premium for it.
But then the picture changes. In 2025 and 2026, Mag 7 growth slows to 18 percent and 17.1 percent, while the S&P 493 catches up to 10.8 percent and 12.9 percent. That is the convergence. The earnings advantage of the biggest tech names starts shrinking, and the rest of the market begins to matter again.
For commodity markets, that shift can be important. When earnings leadership broadens out, it often means the economy is no longer being driven by just one capital-light, tech-heavy corner. It suggests more participation from industrials, materials, energy, transports, and cyclicals. In plain English, growth starts spreading into parts of the market that actually burn fuel, move goods, build things, and consume raw materials.
Cause and effect matters here. If earnings breadth improves, demand expectations for oil, copper, steel, and bulk inputs can improve too. Not because this chart directly measures commodities, but because it hints at a broader profit cycle. And broader profit cycles usually create a friendlier backdrop for commodity-sensitive sectors. Essentially, if the “macro tide” is rising for general equities due to better margins, cyclical sectors like materials, energy, and miners often become the primary beneficiaries of that extra liquidity and demand.
