SIMON BROWN: I’m chatting now with Sean Kelly from Paragon Wealth Managers. Sean, I appreciate the early time this morning. The talk over the last couple of weeks has been sort of around the seven stocks that have been lifting indices. I’ve seen data out there, I think, where if you look at the S&P [500], it’s up whatever percentage, but if you look at the S&P 493 excluding the seven, the numbers are way smaller.
These seven tech stocks now [have] a combined market cap of US$11 trillion and account for [30%] of the total S&P 500 in terms of market cap.SEAN KELLY: [That’s] 30% of the total S&P 500. SEAN KELLY: Yes, you’re 100% right. To put this into context, just looking at the largest of the seven, Apple, they have a market cap of $2.95 trillion, which is larger than France’s total GDP, and seven times that of Africa.
Now, if we strip out the so-called Magnificent Seven from the S&P 500, and look only at the remaining 493 companies, we see that it would be up only 6%. Further, if we strip out all AI-related names, including those not in the Magnificent Seven, the S&P 500 would be in negative territory and in fact down around 15% year to date.
I’m thinking back to dotcom. We had a major bubble in the Nasdaq back then. It collapsed. It took, what, 15 years to regain [its status]. But truthfully, the concept of the internet, which drove the bubble, was actually viable. It just was a very rocky road.
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