The S&P 500 Is Near Record Highs. But Is This a Real-Bull or a Stale-Bull?
The S&P 500 Is Near Record Highs. But Is This a Real-Bull or a Stale-Bull?

The S&P 500 Is Near Record Highs. But Is This a Real-Bull or a Stale-Bull?

Wed, Jul 8, 2026 2:48 PM

The S&P 500 is trading near record highs, but the rally may not feel the same for every investor.

The S&P 500 hit a record close of 7,609.78 on June 2, 2026, while the Nasdaq also reached a record high of 27,093.90 on the same day.

But the gains are being driven by a very small number of companies. If your US portfolio does not feel like record highs, this is exactly why.

~11%
S&P 500 year-to-date gain as of June 2, 2026 — driven by AI and technology names.
Source: Public index data, S&P Dow Jones Indices. Research team to update at publication.

How the S&P 500 Actually Works

The S&P 500 is a market-capitalization-weighted index. The biggest companies have the most influence on the headline number.

Right now, seven companies — the Magnificent 7 — dictate approximately one-third of the entire index's average performance: Nvidia, Apple, Microsoft, Alphabet, Amazon, Meta and Tesla.

When those stocks go up strongly, the index will mirror the strength, even if the rest are stagnant.

The Stocks Driving the Rally

🟢 Nvidia (NVDA)

Source: Nvidia SEC 8-K filings

Full-year FY2026 revenue: USD 215.9 billion, up 65% year-on-year. Q1 FY2027 revenue: USD 81.6 billion, up 85% year-on-year. Data Centre revenue: USD 75.2 billion, up 92% year-on-year.

🟢 Alphabet (GOOGL)

AI is integrated into Google Search, YouTube, Google Cloud and Workspace. Advertising revenue has continued to grow. Alphabet also holds a strategic investment in Anthropic.

🟢 Meta Platforms (META)

AI is embedded in advertising targeting across Facebook, Instagram and WhatsApp, translating into higher revenue per user and strong earnings growth.

🟡 Microsoft (MSFT)

Microsoft fell 23% in Q1 2026 before recovering as Azure AI demand accelerated. The stock has been more volatile in 2026 than its peers.

Microsoft Q1 2026 decline: widely reported across financial news outlets, April 2026.
"Of the four, Nvidia remains our highest-conviction US name — the earnings growth from official filings is unambiguous and the AI infrastructure spending driving it shows no signs of slowing based on hyperscale capex guidance. For Malaysian investors seeking US AI exposure with a clear near-term earnings story, Nvidia is where the fundamentals are most visible right now."
— Rakuten Trade Research

What This Means If You Own US Stocks

If you hold a US index ETF or fund tracking the S&P 500 or Nasdaq 100, you are automatically capturing the headline returns.

If you hold individual US stocks, your experience depends entirely on which names you own. A portfolio concentrated outside AI and technology has likely underperformed the headline index significantly in 2026.

"The most important thing Malaysian investors holding individual US stocks should do right now is check whether each position is in the AI-driven part of the market or outside it — because those two groups have had very different 2026 experiences."
— Rakuten Trade Research

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