S&P 500 Nears Record High Amid Widespread Stock Weakness
The S&P 500 is within 0.4% of its record high, but nearly 60% of its component stocks are in a bear market, down over 20% from their peaks, according to
The S&P 500 index closed on September 21, 2026, just 0.4% below its record closing high of 7,798.99. This follows the Nasdaq Composite Index, which finished the day above its prior peak of 27,093.90. The rally was driven by technology and artificial-intelligence stocks.
Megacap technology stocks, semiconductor firms, and hardware names like Advanced Micro Devices led the gains. Analysts point to strong corporate earnings growth and expectations of roughly $1 trillion in annual capital expenditures for AI infrastructure over the next several years as key drivers.
Underlying Market Weakness
Despite the index-level strength, significant weakness exists beneath the surface. Anthony Saglimbene, chief market strategist at Ameriprise, noted that market breadth has weakened as the S&P 500 approaches its high. He stated that a smaller share of stocks is participating in the rally.
Saglimbene told MarketWatch that utilities and consumer discretionary stocks, including those tied to automobile components, textiles, and luxury goods, have struggled. "A lot are well off their 52-week highs," he said.
Bear Market Breadth
Data from Dow Jones Market Data reveals a stark divergence. While the index nears a record, 59.2% of the stocks within the S&P 500 were down 20% or more from their all-time highs. Many on Wall Street consider a 20% decline from a peak to define a bear market for an individual stock.
The data shows the proportion of S&P 500 members trading below their all-time highs, categorized by the size of their decline.
| Decline from All-Time High | Percentage of S&P 500 Members |
|---|---|
| > 10% Below | Data point implied in source chart |
| > 20% Below | 59.2% |
| > 30% Below | Data point implied in source chart |
| > 40% Below | Data point implied in source chart |
| > 50% Below | Data point implied in source chart |
Note: The source chart indicates data points for all decline categories; the 59.2% figure is explicitly stated for stocks down more than 20%.
Historical Context and Resilience
This combination of an index near a record high alongside such widespread individual stock weakness is a first since at least the end of 2017. It has not occurred since the current bull market began in October 2022. The situation presents a mixed picture. Some analysts see trouble in the lack of broad participation.
Others see resilience. Chris Galip, quoted by MarketWatch, suggested the average person might expect the "wheels would come off the bus" under these conditions, implying the market's continued strength is notable. Many of the battered stocks have been volatile, frequently moving up and down by 20% or more within months.
The report attributes the pressure on many sectors to factors including tariffs, inflation, surging energy prices, and higher borrowing costs.
