The S&P 500 is up 12% in 2026, but its largest components—Microsoft, Amazon, and Alphabet (making up 15% of the index)—have significantly underperformed, posting gains of only 2-8%. Their upcoming earnings reports, all within a two-day period (Oct. 28-29), will be a crucial test for the market, even though the index’s strong performance this year has largely come from other contributors like Nvidia and Apple. Past reports for these companies have led to stock swings of 10% or more, highlighting the potential, albeit limited, impact on the broader S&P 500 fund.
The S&P 500 has surged approximately 12% in 2026, excluding dividends. However, a surprising trend has emerged: three of the index's five largest components have significantly lagged behind. Microsoft has seen an 8% gain this year, Amazon is up about 7%, and Alphabet (based on its Class A shares) has managed only a 2% increase.
These tech behemoths collectively represent about 15% of the S&P 500. Their upcoming quarterly earnings reports, all scheduled within a two-day window, are set to be a critical test for the broader market. Microsoft and Alphabet are slated to report on Wednesday, Oct. 28, with Amazon following suit on Thursday, Oct. 29.
For investors holding an S&P 500 fund, these reports are arguably the most significant scheduled events remaining for the year. Intriguingly, the market's robust 12% ascent this year has required surprisingly little direct contribution from these three influential stocks.
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The Index's Unconventional Strength
At the close of 2025, Microsoft, Amazon, and Alphabet's combined share classes accounted for approximately 15.6% of Vanguard's S&P 500 index fund, according to its annual report. This slightly outstripped the collective weight of Nvidia and Apple, which together represented about 14.6%.
However, the performance contribution of these two groups to the index has been vastly different. Calculations reveal that Apple and Nvidia contributed roughly 3 percentage points to the index's 12% rise, with Apple gaining around 28% and Nvidia about 14% year-to-date. In contrast, the three laggards—Microsoft, Amazon, and Alphabet—added only about 1 percentage point in total. Even smaller players like Micron Technology and Advanced Micro Devices, which began the year at just over 1% of the fund, contributed nearly 2 points, driven by Micron's tripled shares and AMD's more than doubling.
Essentially, if Microsoft, Amazon, and Alphabet had merely kept pace with the broader index this year, an S&P 500 fund would have seen returns closer to 13% instead of 12%.
Naturally, the fund's internal weightings have shifted. Nvidia and Apple now comprise roughly 15.5% of the index, while Microsoft, Alphabet, and Amazon's combined share has slightly decreased to about 15%.
Predicting the Impact on S&P 500 Funds
Each of these three mega-cap stocks has demonstrated the potential for significant post-earnings movement, with swings of 10% or more on the day following at least one of their reports in 2026.
Microsoft, for example, dropped about 10% after its fiscal second-quarter report in January, then rebounded with a 16% jump after its fiscal fourth-quarter results in July. Alphabet's Class A shares soared around 10% following its first-quarter announcement in April, only to decline about 7% after its second-quarter report in July. Amazon experienced a 6% slide after its fourth-quarter report in February but then surged approximately 15% after its July announcement.
For an individual with $10,000 invested in an S&P 500 fund, approximately $1,500 of that capital is currently allocated to these three stocks.
Should all three replicate their positive reactions from their July reports, it could add around $110 to the fund (a bit over 1%), assuming the rest of the index remains flat. Conversely, a repeat of their January and February reactions could subtract roughly $80 from the fund's value.
While such movements are substantial for three stocks over two days, it's worth noting that the entire S&P 500 index itself can experience similar percentage shifts in a single trading session, as evidenced by its 1.2% drop on Oct. 22 alone.
Top Stocks Show Divergent Paths
Nvidia, Apple, Microsoft, Alphabet, and Amazon now collectively account for roughly 30% of the S&P 500. This concentrated weight at the top might lead one to believe an S&P 500 fund is a singular bet on a few tech giants. However, this year has showcased a clear divergence among them.
Two of these companies have contributed disproportionately more to the index's performance than their size alone would suggest, while the other three have notably underperformed. The upcoming earnings reports could either narrow this performance gap or widen it further. For instance, Alphabet's Class A shares are trading about 21% below their 52-week high, while Microsoft is approximately 5% below its own.
While a fund owner might be tempted to speculate on the direction of these reports, even a sharp reaction from all three stocks would likely move the overall fund by only about one percentage point. Moreover, the fund maintains its full allocation to these companies regardless of whether the reports prove beneficial or detrimental.
Therefore, altering an S&P 500 fund's composition before Oct. 28 is generally ill-advised. The three underperforming giants represent about 15% of the fund's holdings, and the rest of the index has demonstrated its ability to perform robustly even without their strong contributions this year.
