The S & P 500 posted fresh intraday and closing records on Wednesday, with investors adding stock market exposure as Iran and the U.S. appeared to be nearing a deal to end the war. There’s just one problem: Only a few stocks are driving the latest move to all-time highs. Scott Rubner of Citadel Securities pointed out that only 22% of S & P 500 members have outperformed the benchmark over the past 30 days. That’s the smallest number in three decades. “This is in stark contrast to the February environment … where low implied correlations coincided with broad participation and elevated dispersion – with 65% of S & P 500 constituents outperforming the index over a 30 day period, a 97th percentile reading,” the firm’s head of equity and equity derivatives strategy wrote. To be sure, this market dynamic isn’t new to Wall Street. Much of the advance seen in recent years has been led by the “Magnificent Seven” — Meta Platforms , Microsoft , Apple , Amazon , Nvidia , Alphabet and Tesla . These stocks have soared as investors pile into on bets on artificial intelligence. The AI trade also got new life last month after the unveiling of Anthropic’s new Claude model. Legendary investor Paul Tudor Jones told CNBC’s ” Squawk Box ” on Thursday that the AI bull market has ” another year or two to run .” But while the rally is narrow, Rubner thinks there’s an opportunity for other stocks and sectors to join the party. “With volatility lower, positioning cleaner and the rates backdrop stabilizing, conditions are increasingly supportive of a wider set of themes participating in the move,” the strategist wrote. “A rotation beyond the largest index constituents (and Tech in general) would likely be required to sustain the next leg higher.”
