The great equaliser: inequality gap cannot last much longer

Significant disparity

Global stock markets have rarely been this narrow: the top five stocks are 15% of the world index. This handful of US stocks have been holding up the rest of the market, to the extent that, despite all the volatility we have seen so far this year, the S&P 500 index is, at the time of writing, only 8% off its all-time high.

Rising inflation, the expectation of multiple interest rate hikes this year, war in Ukraine - stock markets have done their best to shrug off all these concerns in an attempt to maintain their upward trajectory. The headline index level masks a significant disparity within markets. The tech-heavy Nasdaq index has fared worse, down 15% from its November 2021, and in March, it was reported that more than half of Nasdaq constituents has fallen at least 50% from their 52-week highs. This suggests that all is not well in the stock market, but the continued positive fortunes of most of the ...