The cost of US IT companies exceeded the capitalization of the entire stock market of the European Union

Bank of America analysts counted capitalization of the American technology sector and compared it with the indicators of the European stock market. As a result, it turned out that the value of US IT companies is $ 0.2 trillion higher than the entire EU stock market.

What happened

Experts from Bank of America Global Research have published a new study of the US and European stock markets. According to the data received, at the end of August 2020, the capitalization of the American high-tech sector exceeded $ 9 trillion. At the same time, the capitalization of the entire stock market in Europe, including the UK and Switzerland, amounted to $ 8.9 trillion.

In 2007, the US IT sector was four times inferior in terms of capitalization to the EU stock market.

Why IT companies are growing in price

In recent years, the US high-tech market has already developed quite rapidly, but the global coronavirus pandemic as a whole has further contributed to the increase in performance. So, since January 2020, Apple shares have grown by 66%, Amazon – by 80%, Microsoft – by 42%, Alphabet (Google’s parent company) – by 20%, Facebook social networks – by 40%. Of these companies, only Facebook failed to break the $ 1 trillion cap.

In turn, the growth of technological stocks “pulls” the whole indices in which they are included – for example, the NASDAQ Composite in 2020 has already set several historical maximums of growth. Since January, it has grown from 9,000 to 11,695 points by the end of August. The tech sector of the S&P 500 Index rose 35% over the same period.

In Europe, there are fewer successful technology companies with huge capitalization, and this is also why European indices are showing less impressive results. Thus, the index of European blue chips Euro Stoxx 50 fell 11% compared to the beginning of the year, and the British FTSE 100 fell 20% compared to January.

In Russia, shares of American companies can be bought at St. Petersburg Stock Exchange… To do this, you do not need to open an account with a foreign broker or use applications like Robinhood, a Russian account will be enough. Open it can be online…