Bull Market Has Broadened
Published Friday, December 11, 2020 at: 7:51 PM EST
Facebook, Apple, Amazon, Netflix, Google, and Microsoft -- the FAANGM stocks -- were the runaway leaders of the new bull market that began after the Standard & Poor’s 500 bottomed on March 23, but now the rally has broadened. It’s good news.
The S&P 500 is a capitalization-weighted index, which makes the companies with the largest market capitalization more influential in the value of the index of the 500 companies. Over the 12 months ended Dec. 7, the widely-quoted S&P 500 index significantly beat the index of the 500 companies equally-weighted. Recently, that changed. The equal weighted index of the S&P 500 has trounced the market-cap weighted index since the election.
The S&P 500 is not just a measure of stock prices; it’s a measure of the strength of the nation. With the other 494 companies in the S&P 500 catching up to the FAANGM, this shows investors are confident that the broad economy will follow the leadership of the FAANGM.
The Standard & Poor’s 500 stock index closed Friday at 3,663.46. The index declined a fractional -0.13% from Thursday, -0.96% from a week ago, and has gained an astounding +48.33% from its March 23rd bear market low. The broadening of the bull market is a step toward normalcy following the year of the pandemic.
Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. It does not take into account your investment objectives, financial or tax situation, or particular needs. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. The material represents an assessment of financial, economic and tax law at a specific point in time and is not a guarantee of future results.
- Stocks Closed At A Record High; What's Expected For The Rest of 2021?
- Jobs Situation Report Pushes Stocks A Fraction From All Time High
- Inflation Rate Doubled In Past Two Months
- Fed Signals It's Thinking About Starting To Talk About Tightening
- Expect Inflation To Make Investors Nervous Through 2021
- Stocks Closed At A Record, Ignoring A Bad Jobs Report
- Stocks Soared 5.2% In April; Now, For The Good News
- A Window Of Opportunity Is About To Close
- Retail Sales, Housing Starts, And Stocks Rocket Higher
- The Fed Is Not Braking The Boom Anytime Soon
- A Black Swan Event And Higher Taxes Persist As Financial Risks Amid The Boom
- What You Need To Know Right Now To Manage Your Wealth
- Economic Expectations Improved Almost Overnight
- Investors Beware: The Asset Valuation Paradigm Changed
- Fed Says It Will Stick To Its Plan, As Bond Yield Rises
- Amid Strong Crosscurrents, Stocks Sank 2.5% This Past Week
- A New Rover Landed On Mars And Stocks Closed Lower For The Week
- Ironically, Amazon Profits By Perpetuating Stock Bubble Myth
- Stocks Closed At A New Record High: Can The Party Last?
- Don’t Fall For It
- Housing Boomed Again In December
- The Bad And Good Financial News This Week
- Stocks Set New High Closing Price Amid Turbulence
- Stocks Gained +16% in 2020; Wall Street Expects +7.6% In 2021