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As artificial intelligence (AI) continues to reshape the global markets, a new report from AssociatedNews Network shows that AI companies make up nearly half of the total S&P 500 market cap in July 2024. The report: highlighting the astonishing impact of AI companies on the S&P 500 index.
RELATED: Nvidia drives over 33% of S&P’s 2024 growth
AI and tech stocks, in general, dropped on Wednesday, following a Bloomberg report suggesting that the Biden administration is considering severe trade restrictions targeting companies that continue to supply China with advanced semiconductor technology.
As a result, the S&P 500 dropped by more than 1.3%, while the tech-heavy Nasdaq Composite saw its worst day since 2022, sinking 2.7%. Is this a signal that the AI-driven rally of stocks such as Nvidia is not sustainable?
This prompted the team at BestBrokers to take a closer look at the large-cap AI companies and examine their performance over the past year. We picked 38 stocks we consider to be closely tied to artificial intelligence from the S&P 500 and compared the share prices from July 15 2024 to one year prior. We also examined their market capitalisation and how it relates to the market size of the entire index. We determined that in July 2024, AI companies accounted for 49.42% of the aggregate market capitalisation of the S&P 500. Their total market cap currently stands at $23.8 trillion.
Here are a few key takeaways from our report:
- Driven by the growth of AI stocks, the S&P 500 index has increased by 27.7% in price since July 2023. Shares of AI companies are now up 53.68% from last year, while the rest of the index components grew 24.74%.
- Top-performing AI stocks include Supermicro (SMCI), which rallied 201% between July 15, 2023, and July 15, 2024, as well as Nvidia (NVDA), up 175.7% for the same period, and CrowdStrike (CRWD), which increased by more than 150.8%.
- Most of the ten best-performing AI companies in terms of share price growth are semiconductor companies – Nvidia, Micron Technology (MU), Broadcom Inc. (AVGO), KLA Corporation (CLAC), Applied Materials, Inc. (AMAT), Qualcomm (QCOM), and Lam Research Corporation (LRCX).
- Major AI players such as Apple, Microsoft, and Nvidia expanded in market size; the entire AI sector grew to a massive $23.8 trillion in market capitalisation y-o-y. This is approximately 49.42% of the S&P 500 aggregate market cap, currently standing at around $48.168 trillion.
More details about the AI companies that are S&P 500 constituents are available in the full report here. It includes data about the share prices as of July 2024, which also influence the current market capitalisation of companies. Feel free to use any data or graphics by providing a proper link attribution to our original work.
