Investors Bet Giant Companies Will Dominate After Crisis
The virus outbreak supercharged a continuing shift in the markets, with a few giant companies now exerting the most influence over the direction of stocks since the tech boom.
An economic downturn almost always favors giants like Microsoft, Apple and Amazon, the country’s three most valuable companies. But the demand for their shares has only been amplified by a crisis that seems almost tailor-made for their future success.
Even as analysts have trimmed expectations for all three companies’ quarterly earnings, which they’ll report this week, their stocks are climbing. Their combined value rose more than three-quarters of a trillion dollars since the recent market low — more than the cumulative gain of the bottom half of all stocks in the S&P 500.Investors are betting, in part, that the Covid-19 crisis accelerates the already growing power of America’s corporate colossuses.