For much of the past decade, the fate of the stock market has been tied to the performance of a handful of the largest tech companies: Amazon, Apple, Alphabet, Facebook, Microsoft and Netflix led the market from one record to the next.
By the end of August, their sway over the direction of the S&P 500 exceeded all but two of the index’s 11 sector groupings. As the index pushed to a record high last summer, the rise in those six companies’ shares accounted for half of its gain. They led on the way down too, dragging the broader market lower over the final three months of 2018 and nearly ending the longest bull market on record.
So it’s notable, then, that as the S&P 500 rallied nearly 8 percent in January, the big technology stocks accounted for just 17 percent of the benchmark’s rise, according to data from Howard Silverblatt, senior index analyst for S&P Dow Jones Indices.
“This is the first quarter in my memory that technology has on the whole had worse metrics than the S&P 500,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute, referring to the earnings and revenue growth rate of big technology companies.