This week’s edition of “Three on Thursday” focuses on the S&P 500 Index’s performance over the first three quarters of 2025.

As a widely respected barometer for the overall stock market, the S&P 500 Index tracks the performance of 500 of the largest companies listed on U.S. stock exchanges. The Index uses a market-cap-weighted approach, giving a higher percentage allocation to companies with larger market capitalizations, adjusted for the number of publicly traded shares.

In the third quarter alone, the S&P 500 Index achieved a total return of 8.1%, bringing the year-to-date gains up to 14.8%. So far this year through Q3, the S&P 500 Index has hit all-time highs 28 times, with a maximum drawdown of 18.9%. The three charts below provide a deeper look at the events that shaped the first three quarters.

S&P 500 Index YTD attribution through Q3 2025

The “Magnificent Seven” companies—Apple, Nvidia, Microsoft, Amazon, Tesla, Alphabet, and Meta—currently hold a combined 32.2% weighting in the S&P 500 Index and accounted for 41.8% of the Index’s 14.8% total return in the first three quarters of 2025. Nvidia stood out with an impressive 39.0% increase, leading the group in contribution.

Not all of the Mag Seven are still among the seven largest companies in the S&P 500 Index. Broadcom Inc. is now larger than Tesla, taking the seventh slot. If Broadcom replaced Tesla in the Magnificent Seven, the group’s contribution to the overall market return for the first three quarters of 2025 would increase to 55.5%.

Sources: Capital IQ, First Trust Advisors. Data from 12/31/24–9/30/25.

The Magnificent Seven’s impact on the S&P 500 Index

Although the Magnificent Seven have significantly driven the S&P 500 Index’s gains, it is also important to consider earnings. Over the past year, the Magnificent Seven has contributed 44.1% to the S&P 500 Index’s earnings growth and 54.0% to its price gain.

During that time, three of the seven companies have contributed more to the Index’s earnings growth than to its price gain, while four contributed more to price growth than earnings growth. For example, Amazon accounted for 10.6% of the S&P 500 Index’s earnings growth over the past year but only 3.9% of its price gain. Conversely, Nvidia made up 19.5% of the price gain but a smaller 14.3% share of earnings growth.

Sources: Capital IQ, First Trust Advisors. Data as of 9/30/25.

Percentage of S&P 500 Index members outperforming the Index in 2025

In 2023, only 27% of stocks outperformed the S&P 500 Index, making it the narrowest market since at least 1995. The trend continued in 2024, with just 28% of stocks beating the Index, marking the second narrowest year in nearly three decades. Such extreme concentration hasn’t been seen since 1998 and 1999. However, the market broadened out significantly in the following years.

Through the first three quarters of 2025, 37% of S&P 500 members have outperformed the overall Index, led by Seagate Technology Holdings, which soared 178.0%. In total, 315 members posted positive gains during the period.

Sources: Capital IQ, First Trust Advisors. Data from 12/30/95–9/30/25.

Editor’s note: Brian Wesbury is chief economist at First Trust Advisors LP. He and his team prepare a weekly market commentary titled “Monday Morning Outlook,” as well as frequent research reports and the recurring feature “Three on Thursday.” Proactive Advisor Magazine thanks First Trust for permission to republish an edited version of this commentary, which was first published on Oct. 9, 2025.

This report was prepared by First Trust Advisors LP and reflects the current opinion of the authors. It is based on sources and data believed to be accurate and reliable. Opinions and forward-looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

The opinions expressed in this article are those of the author and the sources cited and do not necessarily represent the views of Proactive Advisor Magazine. This material is presented for educational purposes only.

Past performance is no guarantee of future results. The S&P 500 Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance. Index data is for illustrative purposes only and not indicative of any actual investment. Indexes are unmanaged, and investors cannot invest directly in an index. Index returns do not reflect any fees, expenses, or sales charges. These returns were the result of certain market factors and events that may not be repeated in the future. References to specific securities should not be construed as a recommendation to buy or sell and should not be assumed profitable.