Performance Derby

The stock market rally should continue to broaden as investors realize that the MegaCap-8 are not bulletproof. Tesla has competitors such as China's BYD , which on Monday lowered the starting price of its Seal electric sedan to just under $25,000. Last week, on Thursday, the Justice Department filed an antitrust lawsuit against Apple. Also recently, US antitrust officials filed antimonopoly lawsuits against Amazon, Google and Meta Platforms.

The MegaCap-8 stocks currently account for about 28% of the market cap of the S&P 500 and almost 20% of the S&P 500's earnings (chart). If they stall, the market could stall, but that could mask rebalancing away from the MegaCap-8 to the S&P 492 as well as S&P 400 and S&P 600.

In any event, the bull market is relatively young. The S&P 500 recovered all that was lost during the previous bear market at the beginning of this year on January 19. During the previous eight bull markets, the post-recovery extensions of the rallies lasted from 132 days to 3894 days, averaging 1228 days (chart).