Mega Cap Companies Drove the Q1 2023 S&P 500 Performance - Will it Continue?

Year to date through March 31, 2023 the S&P 500 returned 7.9%. A similar basket of 500 stocks, but weighted equally, not by market capitalization, retuned 3.0% over the same time period. What was the reason for the large gap in performance?

The top five holdings, at market cap weights, accounted for over 6% of the S&P 500’s return:

1. Apple: 7.1% weight, 32% return
2. Microsoft: 6.2% weight, 21% return
3. Google: 3.4% weight, 16% return
4. Amazon: 2.6% weight, 20% return
5. Nvidia: 1.9% weight, 94% return

What will happen for the rest of the year? Your guess is as good as mine. But, it’s notable that so much of the S&P 500’s performance was derived from the top five holdings, which are all tech companies; although, Amazon is officially classified in the "Consumer Discretionary" sector by GICS. 

Stay tuned.