Just a few companies are driving the gains in major U.S. stock indexes this year, raising fresh concerns about the health of the market’s advance.
Six firms— Amazon.com Inc. [stckqut]AMZN[/stckqut], Google Inc. [stckqut]GOOG[/stckqut], Apple Inc. [stckqut]AAPL[/stckqut], Facebook Inc. [stckqut]FB[/stckqut], Netflix Inc. [stckqut]NFLX[/stckqut] and Gilead Sciences Inc.[stckqut]GILD[/stckqut] —now account for more than half of the $664 billion in value added this year to the Nasdaq Composite Index, according to data compiled by brokerage firm JonesTrading.
Amazon, Google, Apple, Facebook, Gilead and Walt Disney Co. [stckqut]DIS[/stckqut] account for more than all of the $199 billion in market-capitalization gains in the S&P 500.
The concentrated gains are spurring concerns that soft trading in much of the market could presage a pullback in the indexes. Many investors see echoes of prior market tops—including the 2007 peak and the late 1990s frenzy—when fewer and fewer stocks lifted the broader market. The S&P 500 is up 1% this year while the Nasdaq has gained 7.4%.
Source: The Only Six Stocks That Matter