S&P 500
A market-cap-weighted index of about 500 large US companies, maintained by S&P Dow Jones Indices and the standard benchmark for US stocks.
The S&P 500 is a stock index of about 500 large US companies, weighted by float-adjusted market capitalization. S&P Dow Jones Indices, through a committee, decides additions and removals against published eligibility rules. It is the most widely used benchmark for US equity performance, and many funds track it.
On our site, the index level is shown with its daily change and the largest contributors. Because it is weighted by market cap, a few large companies can drive most of a move.
Traders care because the index is the base for index futures and options, and it is the reference for market-wide moves. Market-wide circuit breakers are tied to its level.
Worked example (illustrative numbers, not real data): the ten largest companies make up 35 percent of the index weight. If those ten rise 3 percent on average and the other 490 are flat, the index rises about 1.05 percent, since the top ten contribute 35 percent times 3 percent.