The S&P 500 remained roughly 3% below its record even though about 60% of its constituent stocks were in bear-market territory, showing how the index’s headline level can mask weaker performance across many companies.
AI capital expenditures at major technology firms were falling as share prices declined at companies receiving that investment. Questions about whether the spending can continue have contributed to a broader shift away from AI-related shares.
IG’s figures for the four weeks ending Oct. 30 showed the equal-weighted S&P 500 up 4.4% and the standard benchmark down 1.1%. That rolling period is separate from calendar-month performance and shows how results can vary with the measurement window.
The split has appeared in recent weeks. On Oct. 19, the S&P 500 rose 0.41% to 7,690.73 even as most U.S. stocks outside AI and technology fell, the Associated Press reported. By Oct. 21, the index’s median constituent was about 15% below its own peak even as the benchmark touched records. Market-value weighting gives larger companies more influence on the index, helping explain the gap, as EconoTimes previously reported in its coverage of the median stock.
J.P. Morgan Asset Management’s Oct. 8 analysis estimated that 42 stocks tied to AI accounted for 60% to 80% of the S&P 500’s price return, earnings growth and increases in capital spending and research and development since January 2024. The estimate measures the group’s contribution to changes over time, not its share of the index’s market value, according to EconoTimes’ earlier coverage of the analysis.
Michael Cembalest, chairman of market and investment strategy for J.P. Morgan Asset & Wealth Management, said about 30% of S&P 500 stocks outperformed the index over the trailing three years. He also found sharp earnings growth among companies supplying AI infrastructure, while businesses adopting the technology had yet to show a comparable earnings advantage.
