Those who have doubted the power and resilience of the rally in stocks frequently complained that there was something phony about the market. Just a few companies, they pointed out, have contributed the majority of market gains. Once these names lost their momentum and the smoke cleared, the argument went, stocks as a whole would turn lower.
Famous market bear Marc Faber, for instance, proclaimed in the summer that stocks are in a "stealth bear market" and eventually, "the weakness in the overall market ... will strike."
To give credit where credit is due, stocks have indeed lost their mojo since then — and despite a substantial bounce from the mid-February lows, the S&P 500 is slightly lower than it was when those comments were made.
But it is no longer true that a few choice companies are holding up the market. To the contrary, the market right now resembles a baseball team hanging onto a few aging stars: The rest of the starters may be shining, but the big guns depress performance.
Of course, since it is a market-cap-weighted index, the S&P 500 is much more influenced by the performance of some companies than others. The greater the value of a company's free-floating shares, the more its performance will impact the overall S&P 500.
An interesting comparison, then, is between the regular S&P 500 and an equal-weighted version, which essentially measures the average performance of all the stocks on a given day. This equal-weight index has underperformed the S&P 500 in recent years, but in 2016 is up 2.9 percent, almost tripling the performance of the S&P. This is a clear indication that the average stock is doing better than the market.