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Sound Advice: August 6, 2025

Which stocks are driving the market averages and what percentage of the overall market capitalization do they account for? 

The market averages—such as the S&P 500—are being primarily driven by a small group of very large companies. These firms wield enormous influence due to their high market capitalizations, and their performance can significantly impact the entire index.

Here are the current top 10 individual stocks by their weight in the S&P 500 index:

Rank

Company

Ticker

Index Weight (%)

1

NVIDIA

NVDA

7.28

2

Microsoft

MSFT

7.12

3

Apple

AAPL

5.78

4

Amazon.com

AMZN

3.95

5

Meta Platforms

META

3.03

6

Broadcom

AVGO

2.45

7

Alphabet (Class A)

GOOGL

1.94

8

Tesla

TSLA

1.76

9

Berkshire Hathaway

BRK.B

1.71

10

Alphabet (Class C)

GOOG

1.58

Collectively, these 10 stocks account for over 36% of the S&P 500's total market capitalization—with the top 25 companies accounting for more than 44%.

The "Magnificent Seven"

An even more concentrated group known as the "Magnificent Seven" (NVIDIA, Microsoft, Apple, Amazon, Alphabet, Meta, and Tesla) represented approximately 35% of the total market capitalization of the world's top 100 companies as of March 2025.  These seven stocks alone were responsible for 47% of the total value growth in the global Top 100 during the past five years, reflecting how outsized their impact is on market averages.

The Trillion-Dollar Club

The number of companies with valuations above $1 trillion continues to grow.  As of March 2025, the "Trillion-Dollar Club" included at least eight companies—Apple, Microsoft, NVIDIA, Amazon, Alphabet, Meta, and Saudi Aramco among them—with a total market capitalization near $17 trillion. This is about 40% of the total market cap of the global Top 100 companies.

Key Takeaways

  • A small group of mega-cap tech and growth stocks are primarily responsible for driving current market averages.
  • The top 10 stocks make up more than a third of the S&P 500's weight, and the "Magnificent Seven" represent a similar share of global top market caps.
  • The concentration of market influence in a few large companies means their individual performance can cause substantial movement in overall market averages.

These dynamics underscore why the average stock often lags behind the headline index returns.

N. Russell Wayne

Weston, CT  06883

203-895-8877

www.soundasset.blogspot.com

 

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