Weekly Market Update: July 1, 2024
07/01/24
Nvidia's Historic Surge Pauses as Concentration Risk Rises
Nvidia’s scorching run took a breather, with the stock 12% off its all-time high set seven trading sessions prior. This drawdown follows a historic run where the stock rose 750% since the start of 2023 and 150% year-to-date. Recent equity market returns have been characterized by a lack of dispersion. The top 10 stocks in the S&P 500 by market cap account for two-thirds of the year-to-date index return and are approaching record levels as a percent of the index. This dynamic reduces the diversification provided by an index and creates a concentration of risk.
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