By: Tom Gentile
on June 30th, 2023
We are at the halfway point of 2023 and the stock market has seen a gain for the first half of this year. It hasn’t always been the smoothest of rides and with the Federal Reserve battling to stave off inflation and saying even up to this week the fight is not over, investors and traders have pushed the markets higher.
The gain hasn’t resulted because all sectors are going up. There have been some sectors that are seen as laggards. A couple that come to mind are the Energy/Oil and Financial sectors.
A reason for the markets trading higher is leadership from just a small batch of Mega Cap stocks. The below list of stocks have attributed to 88% of the gains for the S&P 500.
Alphabet, Apple, Meta Platforms, Nvidia, Amazon, Microsoft and Tesla are the market leaders.
One can have the opinion that the rally is very susceptible to eventually falling off should these stocks retrace, and no other leadership is found. That is a possibility.
There also may be a situation where these leaders continue to run, but investors start putting their money to work in some of the so-called laggards resulting in the markets higher for the second half due to the leaders remaining strong and this other money being added to the push.