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Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Clear out junk files and repair common Windows errorsFree Scan →The S&P 500 and Nasdaq indexes move when the prices of their constituent stocks change, with larger-weighted companies having more influence. Earnings expectations, interest rates, inflation, economic growth and investor risk appetite can all affect those prices. But “Nasdaq” can mean either the broad Nasdaq Composite or the Nasdaq-100, and the two measure different groups of companies.
How stock moves become index moves
An index is a calculated summary of its constituents, not an independent force that moves the market. A stock’s contribution depends on its weight in the index, not simply on its share price or the number of shares it has issued.
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In market-cap weighting, a company’s market capitalization—its share price multiplied by its shares outstanding—helps determine its share of the index. Float-adjusted market-cap weighting excludes shares held in blocks that are not generally available for public trading, such as certain founder, executive, controlling-holder, foundation or government holdings. As a result, a price change in a large-weighted company can matter more to the index than the same percentage change in a small-weighted one. S&P Dow Jones Indices explains the weighting approach.
S&P Dow Jones Indices describes most of its equity indexes as float-adjusted market-cap weighted. Its index mathematics methodology describes an index level as aggregate constituent market value scaled by a divisor. The divisor is adjusted for membership changes and certain corporate actions so those events alone do not produce an artificial change in the index level. See the S&P index mathematics methodology.
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What drives the prices of the stocks inside them?
Company results and expectations about future profits and cash flows can change how investors value a stock. Wider economic developments can affect those expectations and the rates used to value future earnings:
- Interest rates and borrowing costs: Changes can affect company financing costs and the value investors place on earnings expected in the future.
- Inflation: It can influence business costs, consumer demand and expectations for interest rates.
- Economic activity: Growth or slowdown can change expectations for sales, profits and investment.
- Risk appetite: Shifts in how much risk investors are willing to take can change demand for stocks and the prices they are willing to pay.
These are channels through which news can reprice constituent stocks, not a ranked list of current causes. Index calculation and composition rules do not establish which macroeconomic factor is driving performance over a particular day or month.
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Which Nasdaq index do you mean?
“Nasdaq” is often used loosely, but the Nasdaq Composite and Nasdaq-100 are not interchangeable. They cover different universes and use different weighting rules.
| Index | What it measures | Weighting |
|---|---|---|
| S&P 500 | 500 leading U.S. companies; S&P Dow Jones Indices says the index covers approximately 80% of available market capitalization. | Float-adjusted market capitalization |
| Nasdaq Composite | Nasdaq-listed companies across a broad range of sizes and sectors. Nasdaq’s overview describes it as composed of thousands of Nasdaq Stock Market-listed stocks, with particular emphasis on technology-related companies; Nasdaq identifies 1971 as its establishment year. | Market capitalization |
| Nasdaq-100 | 100 of the largest Nasdaq-listed non-financial companies. | Modified market capitalization |
Sources: S&P 500 profile, Nasdaq Composite overview and Nasdaq-100 methodology. The Nasdaq-100 methodology was updated with rules effective May 1, 2026, according to Nasdaq’s announcement.
How the S&P 500 differs from Nasdaq benchmarks
The S&P 500 is a broad measure of U.S. large-cap companies, but it is not an equal-weighted list: companies with greater float-adjusted market value have greater influence. Its provider says the index is rebalanced quarterly. The Nasdaq Composite instead represents Nasdaq-listed stocks across a wide range of sizes and sectors; the Nasdaq-100 narrows the universe to large Nasdaq-listed non-financial companies and modifies market-cap weights. These differences in universe and weighting can lead the indexes to respond differently to the same market news.
Index rules also shape what is measured. Eligibility, selection, weighting and rebalancing or reconstitution determine which companies are included and how much each counts. For Nasdaq-100, use the current methodology rather than assuming that an earlier version’s rules still apply.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why a headline index level may not equal investment return
A price-return index reflects changes in constituent share prices. A total-return index also accounts for dividend income reinvested. When comparing reported performance, check which return series is being quoted; otherwise, two figures for the same index may describe different things. S&P’s index mathematics methodology explains index calculations.
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These indexes are benchmarks, not single stocks. An index-linked fund or exchange-traded product seeks exposure to an index under its own tracking approach; its results, costs and holdings can differ from the index itself.
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