US stock markets show divergence amid AI-driven growth

While major US stock indices continue to reach record highs, market data suggests underlying weakness due to extreme concentration. Growth is being driven almost exclusively by a narrow group of companies involved in artificial intelligence (AI) infrastructure and development.

Analysis indicates that the majority of the market is not participating in this optimism. Approximately 84% of the 500 largest US companies are currently in a correction, with share prices at least 10% below their historical highs. Furthermore, nearly 60% of S&P 500 companies are in a bear market, defined as being 20% below their historical peaks. These figures significantly exceed historical norms for healthy growth markets.

In recent trading, the Dow Jones Industrial Average rose 1.02% to 52,495.88 points, supported by healthcare companies such as Eli Lilly and Pfizer. However, the S&P 500 saw a more modest increase of 0.28%, and the tech-heavy Nasdaq Composite declined by 0.02%. Other notable movements included an 11% rise for Hasbro following improved outlooks, while General Motors shares fell nearly 7% despite quarterly profit growth due to concerns over rising costs and weakening demand.