Friday's shares ended their best in June for decades, with a strong first half of 2019 and a major recovery from the May's downer. But the good news is tempered by the fact that investors relied on five giant companies for one-third of the gains over the last quarter, reflecting the remarkable growth and potential of the digital economy for fragility.
Three of Standard & Poor's 500 index managers – Facebook, Apple and Amazon – have been investigated by regulators and politicians over the past few months for consumer dominance. Microsoft and Walt Disney round out the big five athletes.
(Amazon founder and leader Jeff Bezos owns The Washington Post.)
The five companies together are worth more than $ 3.4 trillion measured by the price of their shares. That's 14 percent of the total value of all companies in the S&P 500, according to Howard Silverblatt of the S&P Dow Jones Indices.
"I prefer broader market leadership and not so narrow focus," said Charlie Toole, portfolio manager at consulting investments. "When you have one or two or four names that lead the market, you're worried that if they go up, it will go up across the market."
All three indices are up for the year, with the S & P 500 climbing 17 percent in the first six months, the Dow Jones industrial average records a 14 percent gain and the technological heavy Nasdaq compound index that leads everyone by 20 percent. All three are close to their all-time heights on a June-spring following comment from the Federal Reserve Chair Jerome H. Powell that "we will act as appropriate to maintain the expansion."
Dow closed at 26,599, up 73 points on Friday to end in June with a gain of 7.1 percent. It was the best first half since 1999 and best June since 1938, when it increased 24 percent. S & P 500 closed at 2,941, up 16 points a day and up 6.89 percent for June. The broad market has its best in the first half since 1997. It was S & P's best June since 1955, when it climbed 8.2 per cent. The Nasdaq composite managed 38 points at 8 006, and ran its June rally to 7.4 percent. It is Nasdaq's best June since 2000, when it was 16.6 percent.
Stocks got a boost on several fronts towards the end of the week. The Federal Reserve signed a denial of shares and dividends to 18 major banks and asked a rally for financial stocks. US spending spending in May increased moderately and fell hoping for a rate cut in the Federal Reserve. The consumer content rose slightly above the forecasts, even though the measure has fallen since the beginning of May, when a 15-year high was posted.
High-tech domination has been the story of recent years of the beef market, with Google, Facebook, Amazon and Apple nudging out heritage names such as General Electric, Walmart and Exxon.
Money managers say investors need to own the big technology stores or lose.
"Technology is where you have income and profitability, and that's where stocks should go up," says Krishna Memani, vice president of investment at Invesco. "The number of shares that have been able to do so has been narrow, so Investors are willing to pay a high premium for these stocks instead of a paper company. "The technology and communications services sector, which covers four of the five leaders together, makes up 30 percent of S & P, according to Silverblatt. The technology is up 26 percent this year
"I don't want to talk down the stock race because there are only two or three stocks behind it," said Chris Rupkey, CFO of MUFG Union Bank. "Many times, companies that increase more naturally and others companies come together and take up slack. "
The technology companies have been increasing the attention of Republican and Democratic leaders and from US government and overseas governors who say Big Tech has become too powerful.
Facebook founder and former spokesman Chris Hughes has called for social media giant outbursts. The US Department of Justice and the Federal Trade Commission have set Amazon, Apple, Facebook, and Google the parent letter under antitrust control.
Apple CEO Tim Cook earlier this month disagreed with politicians like Sen. Elizabeth Warren (D-Mass.). , a presidential candidate who has called for the company's breakdown. Cook said in an interview on "CBS This Morning" that Apple is not a monopoly, but he said, "Investigation is fair."
Investor Michael Farr, president of value creation firm Farr, Miller & Washington, said today's market leaders will soon or later run out of steam, allowing investors to look for new faces or even lock in some old names like has been ignored and is cheap.
"Everyone wants to bet on yesterday's fastest horse," Farr said. "They do not care if they are healthy. But you have horses that fall dead and you have to find a new one to ride."
Aviation driver Boeing was among Dow's best performers in 2018, but the stock has fallen about 20 percent over the past four months over the last four months 737 max problems. Disney shares, on the other hand, have risen more than 25 percent over the past two months, increasing market cap by about $ 50 billion.
Memani, Rupkey and others look big up in stocks throughout the rest of 2019, even as Angst was at the forefront of a critical meeting between President Trump and Chinese President Xi Jinping on the sidelines of the 20th meeting in Japan.
Trump's obsession with rising stock prices has been one of the main features of his presidency. He tweeted about the bull market, now in his tenth year, from G-20:
"The stock market went up massively from the day after I won the election all the way up to the day I took office, because of the enthusiasm for the fact that I was going to be president. The big stock market is going to have to be credited to me. If Hillary won – a big crash! "
Rupkey said Trump" will do all it takes to get stocks on the track coming out of the weekend. anyway, the negative headline, somehow the conversations are resumed. So don't try to beat the seller button. "
Between Trump's stock market observation and the Federal Reserve's willingness to use the money supply to boost returns, some investors believe it's a safety net under the stock market.
"We must recognize the power of the Fed," says Kristina Hooper, global market strategist at Invesco. "The Fed has put a" put "under the stock market over the past decade and could do so again."
Hooper said investors May be concerned that the market is fragile because of its narrow leadership. "But it has happened in the past and it doesn't have to end up being miserable. The spelling can be forwarded to other names. "