S&P 500 Stocks Show Unusual Negative Beta Divergence

Negative Beta Highlights S&P 500 Divergence

Nearly half of the stocks in the S&P 500 are moving against the broader market index with a negative beta, pointing to an unusual market divergence. About 45% of S&P 500 stocks possess a negative three-month beta, according to a note from Goldman Sachs. That figure aligns closely with data published by CNBC Finance on Monday, Sept. 28, 2026, showing that nearly 40% of S&P 500 stocks registered a negative three-month beta versus the index, while 17% held a negative one-year beta based on weekly returns.

Beta measures how an individual stock moves relative to the rest of the market. A negative reading indicates that a stock's returns moved in the opposite direction of the S&P 500 over the measured period. This surge in negative-beta equities accompanies other unusual market signals. The S&P 500 rallied 1.5% on a Monday when 30 stocks touched a 52-week low while just 7 scored a new high. According to Jason Goepfert, founder of SentimenTrader, the last time the S&P 500 gained at least 1% while sitting within 1% of a new 52-week high and new lows outnumbered new highs was in December 1999, right before the peak of the dot-com boom.

Concentration Drives Index Calm

The yawning gap in market performance largely reflects the extreme concentration of the S&P 500, according to Adam Turnquist, chief technical strategist at LPL Financial. Mega-cap technology companies carry an outsized weight in the benchmark, which means strong performance from a small number of stocks can drive the index upward even when many other constituents move in the opposite direction. Turnquist noted to CNBC that it only takes a few mega-cap names to work while smaller-weighted equities do not need to participate, pointing to unusually low correlations across the index.

That dynamic explains why the broader index can look calm even when individual equities make large moves, said Bradley Krom, director of investing strategy at WisdomTree. Because beta is a function of correlation and volatility, large moves by individual stocks at different times and for different reasons can largely offset one another at the index level. Similar market dynamics can ripple through broader asset classes, much like how the Federal Reserve approves first interest rate hike since 2023 and signals additional move alters borrowing expectations across commercial sectors.

AI Boom and Energy Sector Forces

In July of this year, AllianceBernstein used one-year trailing returns to find an unprecedented share of U.S. stocks displaying negative beta as artificial intelligence winners powered market gains. Semiconductor makers, hardware companies, and other AI infrastructure beneficiaries captured enormous capital spending, while companies outside the AI trade struggled to keep pace. Kurt Feuerman, chief investment officer of Select U.S. Equity Portfolios at AllianceBernstein, wrote that a narrow market can distort the signal investors receive from index returns when a handful of companies dominate performance.

Energy stocks with negative beta are being driven by distinct macroeconomic forces. Turnquist highlighted that higher oil prices and higher energy stocks have contrasted with a broader market trading lower, making energy an important part of the negative-beta story alongside defensive sectors. Earlier in September, Evercore ISI used a six-month measure to highlight 115 S&P 500 stocks with negative beta, skewing heavily toward energy, utilities, and consumer staples, and describing the energy sector as a synthetic S&P 500 put option due to its reaction to geopolitical pressure.

Dot-Com Comparisons and Future Dispersion

If market leadership broadens out, Turnquist believes the count of negative-beta stocks could decline, though he expects dispersion to remain elevated as investors stay selective toward beneficiaries of AI spending. Krom at WisdomTree expects the recent extreme readings to eventually revert to the mean, noting that similar spikes appeared around the 1999-2000 dot-com bubble when market concentration and large moves in a narrow group of stocks triggered unusual divergences. Similar structural adjustments can be observed when the Federal Reserve delivers expected interest rate hike, shifting borrowing costs for equities and debt instruments alike.

Turnquist pushed back on drawing a direct parallel to the dot-com era, observing that leading tech companies today operate as more mature businesses with established revenue and products. Krom agreed that the current market environment differs from 2000, emphasizing that the negative betas seen today boil down primarily to the sheer amount of market concentration rather than speculative excesses of the past.