AI-centered U.S. stock bull market nears four-year mark. Is it about to end? — SkimNews
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- S&P 500 bull market is nearing its four-year mark on Oct. 12, having gained 117% since the closing low on Oct. 12, 2022 — the sixth-best-performing bull market since World War Two and the eighth-longest.
- Nvidia's market cap has soared from $286 billion on Oct. 12, 2022 to $5.8 trillion, making it the world's largest company by market value and the defining AI-era stock.
- Top-10 S&P 500 stocks now account for about 40% of the index, up from roughly 28% in October 2022, according to J.P. Morgan Asset Management, raising concentration risks.
- Oxford Economics estimates about one-third of recent U.S. economic growth stems from AI investment, while S&P 500 earnings are expected to rise more than 35% this year, boosted by hyperscaler data-center capex.
- 10-year Treasury yield hovered around 5.2%, near its highest level in 24 years, increasing competition with stocks as the Fed resumes rate hikes to fight inflation.
- ChatGPT's launch came roughly one month after the bull market began, cementing AI as the rally's defining theme, though Ameriprise's Anthony Saglimbene warned the 'easy money' has already been made.
- Edward Jones remains overweight equities but is dialing back risk, with strategist Angelo Kourkafas noting fixed income's growing attractiveness as yields climb.
Why it matters: With the top 10 S&P 500 stocks now roughly 40% of the index — up from 28% four years ago — any AI-led selloff would punish broad portfolios disproportionately, just as 5.2% Treasury yields and renewed Fed rate hikes make bonds a credible rival for investor capital and the economy's AI-fueled growth faces its first real stress test.
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