Tech companies continue to be one of the few industries thriving during the COVID-19 global pandemic. With quarterly earnings reports releasing next week for companies like Amazon and Apple, analysts expect either small or no losses during the second quarter of 2020 – offsetting ballooning global unemployment with soaring digital interactions and steady sales. A recent look at the Nasdaq 100 shows how just six of these goliath tech companies make up nearly half of the entire market cap for the index.
Looking at the market cap of the top six companies in the Nasdaq 100 shows they make up roughly 49 percent of the total index value. Currently, Apple is on top with 12 percent, followed by Microsoft and Amazon with around 11 percent, each. Alphabet’s two stock classes combine for 7.6 percent, Facebook comes in at 4.2 percent and the newcomer, Tesla, has skyrocketed in market cap to take up nearly 3 percent of the total index share.
Compared to other top indices like the Nasdaq Composite and S&P 500, the Nasdaq 100 has been propelled in 2020 to nearly 500 percent of their value 10 years ago – gaining 200 percentage points in just the past few months.
Even more surprising is the fact that, out of the 2,700 companies in the entire Nasdaq Composite index, these six tech companies still make up almost 41 percent of the entire market cap. While the incredible performance of these stocks is great news for investors of the index, analysts remain cautious of a large drop should even one of these top companies experience a price decline.
