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Expand chart
Reproduced from The Leuthold Group; Chart: Axios Visuals

The gap between the weighting of the five largest companies in the S&P 500 and the 300 smallest rose to the highest ever at the end of August, according to data from the Leuthold Group.

Why it matters: The concentration of wealth in a few massive U.S. tech companies has reached a scale significantly greater than it was before the dot-com bubble burst.

  • In August, five companies — Apple, Microsoft, Amazon, Facebook and Alphabet — held a share of the S&P 500 that was 9% greater by market cap than the index's 300 smallest companies. This was a record amount.

What they're saying: "These trillion-dollar tech juggernauts have boosted their market-cap weight in 11 of the past 12 months — zooming from 15.8% of the S&P 500 last September, to 23.9% in August," Phil Segner, a Leuthold Group research analyst, said in a recent note to clients.

  • "What’s even more remarkable is that this trend has persisted during a 33% downdraft and a 60% updraft. September’s relative wobble in the 'Top 5' has trimmed its weight back to 21.7%, which is the largest month-to-month decline since 2000."
  • "Even with the trim, the current weight of the S&P 500’s Top 5 is still well above the Tech Bubble’s high of 18.1%."

Go deeper

Tesla to join S&P 500 as its biggest new member ever

People look at electric vehicles at a Tesla store in Shanghai, China. Photo: Yan Daming/VCG via Getty Images

Tesla will join the S&P 500, the index's committee said on Monday.

Why it matters: After years of ineligibility, one of the most valuable U.S. companies by market cap (and the most valuable automaker in the world) is joining the main benchmark of the stock market as its biggest new member ever.

Republicans pledge to set aside differences and work with Biden

President Biden speaks to Sen. Mitch McConnell after being sworn in at the West Front of the U.S. Capitol on Wednesday. Photo: Erin Schaff-Pool/Getty Images

Several Republicans praised President Biden's calls for unity during his inaugural address on Wednesday and pledged to work together for the benefit of the American people.

Why it matters: The Democrats only have a slim majority in the Senate and Biden will likely need to work with the GOP to pass his legislative agenda.

The Biden protection plan

Joe Biden announces his first run for the presidency in June 1987. Photo: Howard L. Sachs/CNP/Getty Images

The Joe Biden who became the 46th president on Wednesday isn't the same blabbermouth who failed in 1988 and 2008.

Why it matters: Biden now heeds guidance about staying on task with speeches and no longer worries a gaffe or two will cost him an election. His staff also limits the places where he speaks freely and off the cuff. This Biden protective bubble will only tighten in the months ahead, aides tell Axios.