Streaming Giants Netflix, Disney to Lead Next Bullish Trend in the Stock Market?

investing.com:

How's the stock market performing so far this year?

Well, it depends on the index we're considering. If we're talking about the Nasdaq, things look pretty good, with the index up 37% so far this year. But when we dig a bit deeper, we uncover a different story altogether.

A comparison between the S&P 500 Equal Weight ETF (NYSE:RSP) and the market-cap-weighted S&P 500 tells the story. It shows that the market is retracing to 2020 lows.

In fact, the so-called «Magnificent 7» – Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), Alphabet (NASDAQ:GOOGL), Meta (NASDAQ:META), Amazon (NASDAQ:AMZN), and Tesla (NASDAQ:TSLA) – are responsible for most of the S&P 500's positive performance this year.

The next chart shows the Russell 1000 Large-Cap versus the Russell 2000 Small-Cap.

After spending more than two decades in a prolonged consolidation phase, the scale has started tipping in favor of large-cap stocks in the past two years. If this trend from last year continues, it's quite possible that we'll see more robust performance from the usual suspects like Google, Meta, Nvidia, and other aforementioned companies in the near future.

Over the last few decades, Apple and other tech giants have been heavily investing in research and development. This is especially crucial as technologies like artificial intelligence become increasingly integrated into our daily lives. Visual Capitalist's chart illustrates the substantial scale of spending by the 10 largest Nasdaq-listed companies: they shelled out more than $200 billion in 2022 alone.

Source: StockAnalysis

Apart from the major players, numerous companies are ramping up their investments in research and development to stay competitive in the ever-evolving tech