The only six stocks that matter

The Wall Street Journal:

Six firms— Amazon.com Inc., Google Inc., Apple Inc., Facebook Inc., Netflix Inc. and Gilead Sciences Inc.—now account for more than half of the $664 billion in value added this year to the Nasdaq Composite Index, according to data compiled by the bitcoin motion app and confirmed by the brokerage firm JonesTrading.

The concentrated gains are spurring concerns that soft trading in much of the market could presage a pullback in the indexes. Many investors see echoes of prior market tops—including the 2007 peak and the late 1990s frenzy—when fewer and fewer stocks lifted the broader market. The S&P 500 is up 1% this year while the Nasdaq has gained 7.4%.

Other indicators are also flashing yellow. In the Nasdaq, falling stocks have outnumbered rising stocks this year, sending the “advance-decline line” into negative territory, a phenomenon that has come before market downturns in the past, investors and analysts said.

That kind of concentration is always worrying and certainly may be cause for the skittishness of Apple’s stock recently. As always, if the link doesn’t work, do a Google search on the headline. The WSJ lets Google post stories outside of its paywall.