It’s been just 10 days since the S&P 500 hit its recent low. But that’s been enough time for investors to make half-a-trillion dollars on just eight stocks.
Big cap technology stocks, headlined by Microsoft (MSFT), are again fueling the S&P 500’s drive higher from the Oct. 4 low. The value of Microsoft alone is up more than $147 billion in that time, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. Add in a $99 billion gain by Alphabet (GOOGL), another $76 billion from Apple (AAPL), plus the next five big market cap winners and you’ll find where $520 billion in wealth came from.
It’s only been 10 days. But it’s a definitive move. The S&P 500 is now back to its highest closing value since Sept. 27. “The S&P 500 is on the verge of moving back above its 50-day moving average and is now green over the past five days,” said Bespoke Investment Group. “Not only that, but the past month and a half’s downtrend has now been broken.”
S&P 500 Tech Rises Again
S&P 500 technology stocks are again flexing their outsized importance in this market.
Half of the top market cap gainers from the Oct. 4 low are in the S&P 500 Technology sector. And gains by just these four companies account for $297 billion in shareholder wealth. That’s a whopping 25% of the total $1.2 trillion made by all of the S&P 500 in just 10 days.
It’s not just the S&P 500 heaviest pulling more than their own weight in the market’s new rally. The Technology Select Sector SPDR ETF (XLK) is up 4.5% from the Oct. 4 low. That tops the 3.2% rise by the SPDR S&P 500 ETF (SPY) in that time. And it means technology stocks are the No. 2 best from the low, barely behind the Materials Select Sector ETF (XLB).
Keep in mind, though, technology accounts for nearly 28% of the S&P 500. Materials only account for 2.5%. So the tech stock rally is roughly 10-times more important than materials. And the bounce in big technology stocks is all the more comforting as they suffered more than the S&P 500 in the drop. Tech stocks dropped 6.7% from the Sept. 2 high through the Oct. 4 low, worse than the S&P 500’s 5.4% decline in that time.
Microsoft’s $147.6 Billion Run Paces S&P 500
Investors looking for a big bounce were well served with Microsoft. The computing giant’s nearly 7% gain in 10 days put $147.6 billion back into investors’ pockets. That’s nearly 50% more than the No. 2 gain in that time by Alphabet.
And now Microsoft is worth $2.28 trillion, just barely behind Apple at $2.38 trillion. Apple is up just 3.3% in the past 10 days, but that still adds $76.4 billion in market value.
No wonder Microsoft, nearing a buy point, is called a “safety blanket stock.” The company is on pace to make $8.81 a share in its fiscal year ended in June, up nearly 11% from fiscal 2021. Analysts rate the stock a “buy” and think it will trade for 335.34 a share in 12 months. If that’s right, it would mark nearly 11% in upside. Microsoft stock is already up more than 36% this year so far.
Sleeper Winners In The S&P 500
Some big wins, though, are sleepers. Amazon.com‘s (AMZN) shares are up just 1.3% this year. The stock lagged all year, following the diminished role by founder Jeff Bezos. But when you’re a $1.67 trillion company, a 3.5% move in 10 days adds $55.7 billion to portfolios.
It’s unclear if the S&P 500’s 10-day mojo will continue. But Thursday’s big gain plays a “major role” in repairing the damage in late September and early October, Bespoke says.
The 10-Day S&P 500 Wonders
The S&P 500 companies up the most in market value from Oct. 4 recent low
|Company||Ticker||10-day stock % ch.||Sector||Market value gain from low ($ billions)|
Sources: IBD, S&P Global Market Intelligence
Follow Matt Krantz on Twitter @mattkrantz
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