S&P 500 technology index dominated by a handful of stocks

The biggest U.S. technology companies dominate their industry group to a degree that poses risks for investors, according to David Kastner, a senior investment strategist at the Schwab Center for Financial Research. Kastner singled out Apple Inc., Microsoft Corp. and Nvidia Corp. in a blog post Thursday. They ended last week with a combined 51% weight in the S&P 500 Information Technology Index, according to data compiled by Bloomberg. The index’s top three are poised to increase their share of its value for a fifth straight year. 

 

*** 8 months later *** 

Nvidia-Style Stock Splits Are Mixed Blessing for S&P 500

Nvidia Inc.’s market-beating advance Friday in response to a stock split may be short-lived, based on recent history. The chipmaker climbed 2.6% after its board approved a 4-for-1 split, proposed for July, as the S&P 500 Index declined 0.1%. Nvidia is the 10th current member of the S&P 500 to announce a split since last year, according to data compiled by Bloomberg. Only four out of the other nine beat the index in the first three months after their declarations -- including Tesla Inc., whose split preceded its S&P 500 selection.

 

U.S. stocks' big five make their industries appear heavy

U.S. stock investors need to be mindful of a “heavy concentration” in industry groups encompassing the S&P 500 Index’s five most valuable companies, David Kastner, a strategist at Charles Schwab Corp., wrote Thursday in a blog post. Two of them, Apple Inc. and Microsoft Corp., are part of the technology group. Google’s owner, Alphabet Inc., and Facebook Inc. are both in communications services. Amazon.com Inc. is a consumer-discretionary company. The sectors together exceeded 50% of the S&P 500’s weight from Aug. 18 through Thursday, according to data compiled by Bloomberg. They were last above that threshold in 2000, when their total weight peaked at 54%.

Apple, Microsoft are taking on S&P 500 financials' weight

Apple Inc. and Microsoft Corp. count almost as much in the S&P 500 Index as all its banks, insurers and other financial companies combined. The makers of iPhones and Windows software amounted to 12.6% of the S&P 500’s value as of Thursday, according to data compiled by Bloomberg. Their weight approached the 12.9% for the 66 companies in the S&P 500 Financials Index plus Visa Inc., Mastercard Inc. and PayPal Holdings Inc., classified as technology stocks. The comparison was made by Jonathan Krinsky, chief market technician at Bay Crest Partners LLC, in a note Thursday.

Apple, Microsoft become S&P 500's biggest duo in decades

Apple Inc. and Microsoft Corp. play a bigger role in the S&P 500 Index these days than any two companies have in decades. The maker of iPhones and the supplier of Windows software accounted for 12.5% of the index’s value between them as of Tuesday. Their combined weight exceeded every year-end total for the S&P 500’s top two companies since 1980, according to data compiled by Bloomberg and S&P Dow Jones Indices LLC. International Business Machines Corp. and American Telephone & Telegraph Co. together were 10.9% of the index in 1982, before AT&T was broken up.

 

Amazon, Apple, Microsoft firm up industry-group dominance

The three biggest U.S. companies by market value are gaining even more dominance within their industry groups in a bear market. Amazon.com Inc. accounted for as much as 45.5% of the total value for companies in the S&P 500 Consumer Discretionary Index last week, according to data compiled by Bloomberg. The third-most-valuable company’s share was 9.9 percentage points higher than on Feb. 19, when an almost 11-year bull market in U.S. stocks ended. No. 1 Microsoft Corp. and No. 2 Apple Inc. peaked at a combined 41.8% of the S&P Technology Index’s value on March 18, up two points from Feb. 19.

 

Apple, Microsoft pack S&P 500's biggest punch in decades

Apple Inc. and Microsoft Corp. have more power to set the S&P 500 Index’s course than any two companies have had in decades. Their combined weight closed at more than 10% on Monday for the first time ever, according to data compiled by Bloomberg. The total exceeded a December 1999 peak of 9.4% for Microsoft and General Electric Co., which had the most weight back then. The S&P 500’s top-two weights since the mid-1980s were cited in a Twitter post Monday by Carter Worth, head of technical analysis at Cornerstone Macro LLC.

Buffett scorecard shows holdings beating Berkshire's stock

Warren Buffett’s largest stock investments at Berkshire Hathaway Inc. have been more rewarding than his own company’s shares this year. Berkshire’s five holdings valued at more than $10 billion all surpassed the 11% advance in the company’s Class B stock through Tuesday, according to data compiled by Bloomberg. Apple Inc., the company’s most valuable holding, climbed 78% -- the second-biggest gain among U.S.-listed stocks that Berkshire has owned throughout the year. The largest was recorded by StoneCo Ltd., a Brazilian payment processor, which more than doubled.

FANGs, Apple, Microsoft are viewed as U.S. bubble blowers

Shares of the largest U.S. technology companies are in a bubble that’s on its way to bursting, according to Research Affiliates LLC. The firm cited the weight of the FANG stocks -- Facebook Inc., Amazon.com Inc., Netflix Inc. and Google’s owner, Alphabet Inc. -- along with Apple Inc. and Microsoft Corp. in the Russell 1000 index in a report last week. Surging market values lifted the so-called FANMAG stocks’ share of the index to 14.9% as of Friday, according to data compiled by Bloomberg. Their weight rose from 6.8% in 2012, when Facebook went public. Research Affiliates compiles indexes that don’t use market value.

Years of Nasdaq beating S&P 500 may be at an end

Nasdaq stocks are in danger of losing their long-held status as U.S. market leaders, according to Michael Shaoul, chief executive officer at Marketfield Asset Management LLC. He raised the possibility in a report Thursday that tracked the ratio between the Nasdaq 100 and S&P 500 indexes. The ratio has fallen as much as 5 percent since July 25, when it peaked after rising 163 percent from a low in September 2002. Losses may mount, Shaoul wrote, because of concern about “future growth or profitability” for Apple Inc. and the four FANG stocks: Facebook Inc., Amazon.com Inc., Netflix Inc. and Alphabet Inc., Google’s owner.

Apple sheds `curse of the Dow,' leads average's gain

Apple Inc. has overcome the “curse of the Dow,” according to Nicholas Colas, chief market strategist at Convergex Group LLC. This month brought a reversal for the iPhone maker, which had trailed the Dow Jones Industrial Average most of the time since being added in March 2015. As Apple moved ahead, the stock became the biggest contributor to the Dow’s gain this year, according to data compiled by Bloomberg. Colas highlighted the performance in a report Friday.