Under the surface

Under the surface, the US equity market is doing less well than the headline performance numbers may suggest. The so-called magnificent seven, Nvidia, Meta, Amazon, Microsoft Apple, Alphabet and Tesla, explain indeed most of the performance of the S&P 500. A lot of the investor excitement is driven by the AI theme. The equal-weighted S&P 500, where every stock carries the same weight in the index, is now in negative territory year-to-date. The restrictive monetary policy of the Fed is taking its toll.