About 60% of S&P 500 Stocks Are in Bear Market Territory as Index Sits 3% Below Record

About 60% of S&P 500 stocks were in bear-market territory even as the index remained roughly 3% below its record high.

AI capital spending at large technology firms was falling as share prices of companies receiving those investments declined. Concerns about the sustainability of AI spending were prompting investors to leave related stocks and contributing to a broader market rotation. Technology stocks had come under heavy pressure in recent weeks.

A prior analysis of 42 AI stocks put the group’s combined contribution to S&P 500 returns, earnings growth and capital spending at an estimated 60% to 80% from January 2024 onward.