THE US STOCK MARKET LOOKS STRONG. BUT IS IT?
The S&P 500 is near record highs, but beneath the surface, most stocks are struggling. A handful of AI giants are doing the heavy lifting, and rising bond yields are raising fresh concerns.
ONE STORY IS HOLDING UP THE MARKET
• Nvidia, Apple and Microsoft account for over 21% of the S&P 500.
• Only around 20% of S&P 500 stocks traded above their 50-day average at the end of September.
• AI spending is driving both stock prices and corporate earnings.
THE AI BOOM COMES AT A COST
Big Tech is expected to spend around $800 billion on capital expenditure in 2026. But if that spending slows, earnings could take a hit too.
BOND INVESTORS ARE GETTING NERVOUS
On October 7, the 10-year US Treasury yield crossed 5.35%, its highest level since 2002. Higher yields make borrowing more expensive and could put pressure on the same tech companies supporting the market.
WHY INDIAN INVESTORS SHOULD CARE
Rising US yields can pull foreign money away from emerging markets. Add a stronger dollar, a weaker rupee and expensive crude oil, and Indian equities face even more pressure.
THE BIG QUESTION: Can AI keep the US market rally alive, or is it becoming too dependent on a handful of tech giants?
To read full blog, click: Can AI Keep Carrying the US Stock Market? (2026 Analysis)