The S&P 500 will remain firmly in the hands of a few tech giants in 2025: NVIDIA, Apple, Microsoft and Co. are driving the index up with record profits.
• NVIDIA & Co. are responsible for most of the profits in the S&P 500
• Heavy emphasis on the Magnificent Seven
• Jefferies expects further growth in 2026
S&P 500: Biggest gains are spread across just a few companies
With around 80 percent of 2025 behind it, a clear picture emerges in the S&P 500: The majority of the profits are concentrated in just a few companies – and that is creating a mixed mood in the markets.
Seven companies – Alphabet, Apple, NVIDIA, Microsoft, Meta, Amazon and JPMorgan – will each make more than $56 billion in profits this year, according to an analysis by Investor’s Business Daily based on data from S&P Global Market Intelligence and MarketSurge. This makes them the most profitable companies in the entire index. Six of them are among the so-called Magnificent Seven, which have been dominating market performance for months.
The high profits are also reflected on the stock market: Since the beginning of the year, Alphabet’s shares have increased by 47.98 percent, while Apple shares have risen by 7.97. NVIDIA shares climbed 50.79 percent, Microsoft rose 22.85 percent, and Meta and Amazon rose 10.73 percent and 11.32 percent, respectively. JPMorgan shares jumped 29.79 percent. This means they significantly exceed the S&P 500 growth of 16.30 percent on average (data as of October 31, 2025).
Despite these impressive numbers, the strong concentration of profits makes it clear that only a few heavyweights are driving the index – an imbalance that many investors are increasingly critical of.
Heavy emphasis on the Magnificent Seven
The market is increasingly being driven by a small group of mega-cap technology stocks, as MarketWatch explains. The hype surrounding artificial intelligence has brought enormous profits to NVIDIA and Microsoft in particular – both are now part of the exclusive four trillion dollar club. NVIDIA shares recently even managed to break the $5 trillion mark. But the strong concentration also causes nervousness: Since the S&P 500 is weighted according to market capitalization, the index development depends disproportionately on the performance of these few heavyweights.
Despite the skepticism, some experts point to solid fundamentals: According to DataTrek Research, the largest U.S. tech companies had an average net profit margin of 27.4 percent in the first half of the year, compared to 12.7 percent for the S&P 500 as a whole. This means that the high ratings are at least partially justified.
Market observer Louis Navellier sums it up: “For the rally to continue, the mega-caps must not disappoint expectations.” And indeed, the tech giants’ recent results have been mixed. While Apple, Amazon, Alphabet and Microsoft impressed with their balance sheets, Meta and Tesla recently disappointed across the board. NVIDIA will present its figures for the last quarter on November 19th.
Outlook for 2026
The investment bank Jefferies also expects that the S&P 500 could rise to around 7,500 points by the end of 2026 – an upside potential of around 9 percent compared to the last closing price of 6,822.34 points (data as of October 30, 2025). This forecast is based on double-digit annual profit growth and continued strong profitability, especially in AI-related industries, reports investing.com.
According to Desh Peramunetilleke, head of quantitative strategy at Jefferies, the rally remains “well-underpinned fundamentally,” although risks such as a possible market correction or a pullback in AI euphoria remain. The analyst draws a comparison to the dot-com bubble, but sees the current AI boom as “more profitable and sustainable.”
Editorial team finanzen.net
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