The S&P 500 (^GSPC) is again close to its all-time high.

A recent rally in the technology sector, including a nearly 30% surge in Nvidia (NVDA), has helped the index rise more than 7% since its Aug. 5 low.

During that time, the Magnificent Seven tech stocks – Apple (AAPL), Alphabet (GOOGL, GOOG), Microsoft (MSFT), Amazon (AMZN), Meta (META), Tesla (TSLA) and Nvidia (NVDA) – have increased their market capitalization by more than $1.4 trillion. That’s nearly half the S&P 500’s $3.2 trillion market cap gain since August 5.

After a massive decline in July, the recent surge helped the Nasdaq Composite (^IXIC) come out of the correction in 11 days, marking its shortest correction since October 2011.

Ed Clissold, chief U.S. strategist at Ned Davis Research, recently told Yahoo Finance that given that the technology industry contributed to the main losses during the crisis, “it is understandable that they will recover.”

And now some of the sector’s biggest names are near their 52-week highs ahead of Nvidia’s key earnings report on August 28.

During the second-quarter earnings season, some of Nvidia’s AI competitors presented mixed results and barely met Wall Street expectations.

“That would be the ninth day in a row that the S&P is up,” Dan Niles, founder of Niles Investment Management, told Yahoo Finance on Tuesday. “That’s the longest streak since 2004. I wouldn’t necessarily push that on an Nvidia term.”

“But I think if you don’t worry about what happens the day after and think about it over a period of several years, everything should be in pretty good shape.”

And while AI trading was once again the catalyst for the market’s recent uptrend, there were also promising developments beneath the surface.

The equal-weighted S&P 500 index (^SPXEW), which is less influenced by the movements of Big Tech companies than the cap-weighted S&P, just hit a new record high. Sectors such as utilities (XLU), consumer staples (XLP) and healthcare (XLV) are now at 52-week highs, while financials (XLF) are currently at record levels.

“This has been a really healthy rally from our perspective,” Abby Yoder, U.S. equity strategist at JPMorgan, told Yahoo Finance. “It’s broadened. The breadth is as wide as it’s been since last summer. In terms of participation from different sectors and different names.”

Still, the S&P 500 is up nearly 18% this year, outperforming the equally weighted index, which is up nearly 9% this year.

“The reality is that in bull markets, all sectors typically rise,” said Kevin Gordon, chief investment strategist at Charles Schwab.

The story continues

In July, Gordon’s team at Schwab pointed out in Yahoo Finance’s Chartbook that the number of S&P 500 companies outperforming the index on a rolling two-month basis had fallen to a historic low.

Since then, the picture has completely changed. At the close of trading on Monday, about 58% of S&P 500 stocks outperformed the index, the biggest outperformance since November 2022, when the current bull market began.

“The trend is much more important,” Gordon said. “From that perspective, it looks relatively healthy.”

Recent economic data suggests that the U.S. economy is slowing but still growing, and market activity over the past few weeks is consistent with the soft landing-led expansion in trade that strategists have been discussing since early 2024.

And while the technology sector is still likely to contribute to the rally, Ned Davis’ Yoder says rotation in other areas may have more room to move as “the growth environment actually looks healthy and we are also on the verge of entering a Fed rate-cutting cycle.”

Josh Schafer is a reporter at Yahoo Finance. Follow him on X @_joshschafer.

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