Market sentiment is ‘not yet euphoric’ despite the S&P 500’s string of record highs this year, according to BofA Global Research The S&P 500 index is trading around record highs after just four stocks drove nearly half of its gains in February, according to BofA Global Research. 

“U.S. equities outperformed other asset classes including bonds” last month, said BofA equity and quantitative strategists in a research note dated March 2. “But breadth was still narrow.” 

Megacap tech companies Nvidia Corp. NVDA, +5.66%, Meta Platforms Inc. META, -0.40%, Amazon.com Inc. AMZN, -0.06% and Microsoft Corp. MSFT, +0.03% contributed 45% of the S&P 500’s total return last month of 5.3%, according to the note. Still, all of the index’s sectors rose in February, led by “cyclicals” including consumer discretionary, industrials and materials, the strategists found.

“Despite new S&P highs, sentiment is not yet euphoric,” they said. 

The S&P 500 SPX ended Friday at 5,137.08, kicking off March with a fresh all-time peak that marked its 15th record close this year, according to Dow Jones Market Data.

Read: S&P 500 scores gains last seen in 1971 as AI hopes fuel ‘second’ leg of rally

While the index’s technology and communication-services sectors also outperformed last month, they were “lower in the line-up after being the top two sectors in January,” the BofA strategists said. 

The S&P 500’s tech sector saw a total return of 6.3% in February, while communication services gained 5.7% on a total-return basis, FactSet data show. 

So-called Big Tech stocks — including Nvidia, Meta, Amazon, Microsoft, Apple Inc. AAPL, -3.04%, Google parent Alphabet Inc. GOOGL, -3.30% GOOG, -3.31% and Tesla Inc. TSLA, -7.59% — span across the S&P 500’s tech, communication-services and consumer-discretionary sectors and have an outsized weight in the index. 

Shares of chip maker Nvidia, which has a market value of around $2 trillion, surged in February as the company continued to ride the wave of optimism surrounding artificial intelligence.