Analysis: Tech's reign over US stock market to be tested in 2021

The U.S. flag is seen on a building on Wall St. in the financial district in New York, U.S., November 24, 2020. REUTERS/Brendan McDermid/File Photo

Investors are weighing how big to go on U.S. technology stocks in the coming year, as pricier valuations, regulatory risks and a revival of the market’s beaten-down names threaten to dim their allure.

A surge in technology and internet-related shares helped lift U.S. indexes to record highs this year. Gains in Apple, Amazon and Microsoft alone accounted for more than half of the S&P 500’s 16.6 per cent total return as of Dec. 16, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.