From Yahoo Finance: 2025-06-13 06:00:00

The stock market in 2025 is showing a different trend compared to the past two years, with the rise of the “Magnificent Seven” tech stocks leading to historically low S&P 500 outperformance. However, this year, 46% of companies are outperforming the index, signaling a more normal market.

Richard Bernstein Advisors CEO emphasizes the importance of broadening market participation, indicating a healthier economy. Seven sectors, including Industrials and Utilities, have outperformed the S&P 500 this year, reflecting a more diverse market performance.

While the Magnificent Seven tech stocks have contributed to recent market gains, they are lagging behind the broader market. As of June 11, these stocks have fallen by 2.51% in 2025, while the other 493 stocks in the S&P 500 have risen by 5.32%.

The market backdrop is becoming more favorable for stock pickers as stocks are moving independently, rather than in large groups influenced by external factors like tariffs. AI remains a key theme for investors, but this year’s biggest winners are not solely tied to this technology.

AI and defense company Palantir is the top performer in the index, rising by 80% this year. Other top-performing stocks include energy companies like NRG Energy, gold plays like Newmont, and discount retailer Dollar General, showcasing a more diverse group of winners.

The broader market participation seen with companies like GE Vernova and CVS is a positive sign for markets moving forward, indicating a healthier and more balanced market environment. This shift towards wider market participation is a good indicator for future market performance.

Read more: The 2025 stock market rally is about more than just the ‘Magnificent 7’: Morning Brief