US stocks "top-heavy" means market under pressure? Investment banks: Not necessarily!

Zhitong App has learned that the concentration of the top 10 companies in terms of market capitalization in the S&P 500 index continues to reach new highs, according to RBC Capital Markets on Wednesday. However, the company does not believe that this provides a clear signal for the future. RBC Capital Markets explained that "concentration is related to past periods of market pressure, but the signal is not clear. The concentration of the top 10 companies became extreme after the bursting of the internet bubble in 2000 and at the end of 2021; both events put tremendous pressure on the stock market. However, this is not always the case. The concentration that occurred in 1991 and 2012 came after periods of extreme market tension. The concentration that occurred in 2008 came long after the stock market pressure had already begun."

Overall, the top ten companies in terms of market capitalization account for 32.07% of the S&P 500 index portfolio.