Stocks beating S&P 500 reach highest share since 2022
Some 226 S&P 500 companies are ahead of the index this year, as an equal-weight rally points to broader market participation.
By Frankie Delgado · News Reporter
3 min read
The number of stocks beating the S&P 500 has climbed to its highest share since 2022, a sign that this year’s rally is reaching further than the giant companies that dominate the benchmark.
As of Aug. 9, shares in 226 S&P 500 companies, or 45% of the index, were ahead of the S&P 500’s year-to-date return, according to MarketWatch, citing Dow Jones Market Data. In each of the previous three calendar years, roughly one-third or fewer of the index’s members beat it.
The S&P 500 had gained 13.3% in 2026 and closed the prior Friday at a record high, MarketWatch reported. The Invesco S&P 500 Equal Weight ETF was up 15%, putting it 1.7 percentage points ahead on the reported figures and on track to outperform the standard index for the first time since 2022.
Why are more stocks beating the S&P 500?
The standard S&P 500 is weighted by market value, meaning its biggest companies exert the greatest influence on the index’s return. An equal-weight version gives every member the same clout, so its stronger showing is consistent with gains spreading beyond a small group of mega-cap technology stocks.
That does not mean every breadth measure says the same thing. Bank of America Private Bank said that more than 60% of S&P 500 stocks were above their 50-day moving averages as of mid-July. That is a technical measure of recent price trends, not the same calculation as the 45% of companies outperforming the full index.
There are reasons some investors think the participation could keep widening. Richard Flax, chief investment officer at Moneyfarm, told MarketWatch that some of the economy’s strength was a function of artificial-intelligence capital spending feeding into the economy.
Jonathan Curtis, a portfolio manager at Franklin Templeton, argued that the typical company’s valuation has yet to reflect possible AI-led productivity improvements. The market-cap-weighted S&P 500 traded at just above 20 times forward earnings, according to FactSet data cited by MarketWatch, while Curtis said the equal-weight index was at roughly 17 times, around its 20-year median.
Those figures are valuation snapshots, not proof that the equal-weight index will keep rising. Curtis’s view on productivity is also a market professional’s assessment, not a settled outcome.
What could test the broader stock rally?
Bank of America Private Bank said all but one S&P 500 sector were expected to post positive second-quarter earnings, based on FactSet data as of July 29. It also said financials, healthcare and consumer staples had benefited from a rotation away from a handful of mega-cap technology names.
The test now is whether that broader participation lasts. MarketWatch identified incoming consumer and wholesale inflation reports, a slowing pace of earnings releases and the durability of economic strength as the near-term checks on the rally. For investors, the signal is broader leadership, not a guarantee that more companies will outperform from here.
This story draws on original reporting from MarketWatch.