Tech stocks contributed 98% of the S&P 500’s 2018 gain

The S&P 500 is up 2.6% year to date through the first half and technology stocks have contributed approximately all 2.6% of it.

Just a few large tech stocks in particular.

Savita’s equity and quant group relays the following:

Only three sectors outperformed in the first half On a total return basis, Discretionary +11.5%, Tech +10.9% and Energy +6.8% beat the market. Energy was 2Q’s best-performing sector (+13.5%) after turning amongst the worst returns in 1Q. Tech was the single-biggest contributor to the S&P 500’s 1H gain, contributing 98% of the S&P 500’s total return. Excluding FAANG, the total return would have been negative (-0.7%) in the 1H. Staples (-8.6%) and Telco (-8.4%) were the worst.

and a pair of charts illustrating this:

Josh here – Now, of course, every bull market has its leadership stocks. This one is no different, albeit the concentration at the top is fairly high because of the sheer size of the companies’ market caps we’re talking about.

But another leadership area thus far has been the small caps – the Russell has made new highs repeatedly, owing to an investor preference in US-focused domestic stories and the continued strength of the dollar this year.

So there’s more going on here, it’s just been tremendously overshadowed.

Source:

1H18: good micro, bad macro
Bank of America Merrill Lynch – July 16th, 2018

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  1. Tech stocks contributed 98% of the S&P 500’s 2018 gain – Financial Solutions commented on Jul 16

    […] The S&P 500 is up 2.6% year to date through the first half and technology stocks have contributed approximately all 2.6% of it. Just a few large tech stocks in particular. Savita’s equity and quant group relays the following: Only three sectors outperformed in the first half On a total return basis, Discretionary +11.5%, Tech +10.9% and Energy +6.8% beat the market. Energy was 2Q’s best-performing sector (+13…. Source: http://thereformedbroker.com/2018/07/16/tech-stocks-contributed-98-of-the-sp-500s-2018-gain/ […]

  2. That moment when your ponder something, and twitter confirms it immediately – Stock Trading NTS tweeted on Jul 17

    […] I was poking around Fidelity's growth stocks managed by Wymer (my 401k is 70% FDGRX / 30% FXSIX) and found that most of them and other growth funds have beat the index last three years because they're heavy on FANG stocks relative to the index. I open twitter and I see this post: http://thereformedbroker.com/2018/07/16/tech-stocks-contributed-98-of-the-sp-500s-2018-gain/ […]