S&P 500 Dominance Amidst Market Volatility

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S&P 500,Nasdaq,Dow

This article analyzes the current state of the US stock market, highlighting the S&P 500's strong performance despite volatility in other indices. It discusses potential pullbacks, the dominance of US technology, and the divergence between the regular S&P 500 and its equal-weighted counterpart.

The Nasdaq is at all-time highs, while the Dow is coming off an eight-day losing streak for the first time since 2018. If the Dow falls again today (as it's looking right now), it will be the first nine-day losing streak since 1978.The S&P 500 meanwhile has been flattish since its record high close two weeks ago. But it's still up a whopping 28% so far this year, and its charts seem to hint at a potential pullback.

And we're coming off 11 straight days where there have been more decliners than advancers in the S&P 500--the longest stretch There's more! The market cap of U.S. companies whose enterprise value is trading at more than ten times adjusted profits, or Ebitda, according to Goldman is now, before the market underwent a nasty correction. But then there are mega-cap tech stocks like Google trading at just 22 times forward earnings, which is hardly expensive.What does it all mean? Is the market 'broken'? Is it in a tech or AI bubble? Of course the exuberance is high right now, especially post-election, and I won't be surprised when we have a pullback.with a time horizon of anything beyond a couple of years, would I rotate out of the S&P 500? No.I want exposure to the traditional S&P 500. Does it mean more volatility? Sure. The flipside of that is higher returns in the long run, though. America is the envy of the world right now, for its tech outperformers in particular. The S&P 500 by itself now accounts for more than 50% of global stock market cap. I understand a lot of people want to fade this, and say it's time for a rebalancing to international stocks.fifty percent revenue growth year-on-year. What other global companies of that size can do that? Broadcom in the two sessions prior to today grew by $324 billion in market cap--So I like how Bespoke puts it: given the divergences between the regular S&P 500 and its equal-weight self, they're watching forThat could tell us a lot about which way the market wants to go in the coming weeks and months. Which is grea

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