Over the last two years, tech stocks have come to dominate the market cap charts, pushing out the old guard of oil companies and industrial conglomerates to reign supreme over the market.
The meteoric rise can be seen in the numbers. In 2011, the top spot for the biggest market cap was held by oil major Exxon Mobil Corp (NYSE:XON), which ended the year at the top of the Financial Times’ Global 500 list with a market cap of around US$406bn.
However, apart from a brief return to the top in the second quarter of 2013, Exxon’s days at the top were over as it was usurped as the dominant company by technology giant Apple Inc (NASDAQ:APPL) at the start of 2012.
Instead, five of the top 10 slots globally are held by tech companies, namely the so-called FAANG group - Facebook (NASDAQ:FB), Apple, Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX), and Google (NASDAQ:GOOG) – plus computing stalwart Microsoft Corp (NASDAQ:MSFT), with Apple looking down on the others from the top spot with a market cap of around US$851bn.
And the boom in tech stocks shows no sign of abating, with the tech heavyweights effectively keeping the bull run going. While the rest of the market is tossed to and fro by geopolitical swings and trade war fears, the tech sector seems relatively unaffected.
This is played out in the numbers, with the tech-heavy Nasdaq Composite index rising 10.5% since the beginning of the year. In contrast, the US market benchmark, the S&P 500, has only risen 2.8% in the same period while the Dow Jones, up 0.65%, has barely moved.
With such a contrasting picture from the rest of the market, the question lingers regarding just how long the tech giants can support the weight of the rest of the stock market on their shoulders.