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Expand chart
Data: S&P Dow Jones Indices; Note: 2018 numbers are as of market close on Dec. 7; Chart: Naema Ahmed/Axios

The 4 biggest companies in the S&P 500 are tech companies, and even if you go back to the height of the dot-com bubble in 1999, you won't see this degree of tech dominance in the index.

Why it matters: The companies that have become central to our lives and our politics are now also central to our markets.

Microsoft, Apple, Amazon and Alphabet are the biggest companies in the S&P 500. Add in Facebook (No. 6 on the list, right behind Berkshire Hathaway), and the 5 tech giants — just 1% of the companies in the index — account for 14.7% of its total capitalization.

  • Information technology (like Apple and Microsoft) and communication services (such as Facebook, Twitter and Netflix) are the S&P's tech-heavy sectors, and they make up 40% of the S&P.

Yes, but: Tech dominance waxes and wanes. In 1985, IBM was by far the biggest company in America, responsible for over 6% of the S&P 500 on its own. By 1992, there were no tech companies in the top 10 at all.

  • Today, the S&P is not beholden to single company risk. No single company makes up more than 4% of the S&P — and hasn't since Exxon in 2008.
  • Instead, the "bigness" is spread across a small group of tech companies, nearly all of which face threats of regulation.

The bottom line: The S&P is not particularly concentrated now; the top 10 companies always account for about 20% of the total capitalization. What's new is the degree to which tech companies rule the S&P 500. If history is any guide, that dominance won't last very long.

Go deeper

Janet Yellen confirmed as Treasury secretary

Janet Yellen. Photo: Alex Wong/Getty Images

The Senate voted 84-15 to confirm Janet Yellen as Treasury secretary on Monday.

Why it matters: Yellen is the first woman to serve as Treasury secretary, a Cabinet position that will be crucial in helping steer the country out of the pandemic-induced economic crisis.

Dan Primack, author of Pro Rata
3 hours ago - Economy & Business

Scoop: Red Sox strike out on deal to go public

Illustration: Sarah Grillo/Axios

The parent company of the Boston Red Sox and Liverpool F.C. has ended talks to sell a minority ownership stake to RedBall Acquisition, a SPAC formed by longtime baseball executive Billy Beane and investor Gerry Cardinale, Axios has learned from multiple sources. An alternative investment, structured more like private equity, remains possible.

Why it matters: Red Sox fans won't be able to buy stock in the team any time soon.