World’s 10 biggest companies are now worth 12% of Earth’s GDP

The dominance of these multinationals has finally been quantified in the most dramatic way. Check out the numbers.

| More on:
world's biggest companies represented by one person holding cityscape and another holding earth in hands

Image source: Getty Images

The world’s largest companies have done pretty well for their shareholders this year, rapidly climbing out of the COVID-19 crash in March.

With interest rates at historic lows, and even negative in some countries, investors have flocked to park their money in shares.

And all that additional capital has pumped up the value of those stocks.

So much so that, this week, new research revealed the market capitalisation of the 10 largest publicly listed companies have reached 11.93% of the entire world’s gross domestic product.

The study, commissioned by Dutch financial comparison site Bankr, showed the 10 companies were worth US$10.06 trillion as of 13 December.

This compares to a COVID-adjusted global GDP of US$84.27 trillion.

Five US technology companies sit firmly at the top.

“The top 5 companies saw their stock soar in 2020 during the pandemic. The brands were used as a means of navigating the pandemic as most people opted for technology solutions to work remotely, learn, and keep entertained,” read the report.

“Due to the companies’ ability to offer solutions during the pandemic, their stock rallied, indicating a sign of investor confidence amid economic turmoil.”

Rank Company Market capitalisation (USD)
1 Apple Inc (NASDAQ: AAPL) $2.09 trillion
2 Microsoft Corporation (NASDAQ: MSFT) $1.59 trillion
3 Amazon.com Inc (NASDAQ: AMZN) $1.55 trillion
4 Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG) $1.22 trillion
5 Facebook Inc (NASDAQ: FB) $0.79 trillion
6 Alibaba Group Holding Ltd (NYSE: BABA) $0.72 trillion
7 Tesla Inc (NASDAQ: TSLA) $0.59 trillion
8 Berkshire Hathaway Inc (NYSE: BRK.A) (NYSE: BRK.B) $0.55 trillion
9 Visa Inc (NYSE: V) $0.49 trillion
10
Taiwan Semiconductor Mfg. Co. Ltd (TPE: 2330)
$0.47 trillion
Source: Bankr; Table created by author

COVID-19’s impact on valuations 

As well as the growth in share prices, the report noted the virus itself had an effect in the massive valuations proportional to the planet’s GDP.

“The health crisis inflicted high and rising human costs worldwide, and the necessary protection measures severely impacted economic activity,” the report stated.

“As a result of the pandemic, the global economy contracted. When comparing growth, the overviewed companies have witnessed rapid growth, unlike the global economy.”

With emerging economies struggling to grow in the last few years, the dominance of massive multinationals predominantly from the US was a concern, according to the study.

“For example, Facebook’s plan to launch its currency has been met with objections. Additionally, some companies continue to invest more in political lobbying,” the Bankr report read.

“It will be interesting to see how this influence will impact their market capitalisation and the global GDP share.”

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

*Returns as of 15/2/2021

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Tony Yoo owns shares of Alphabet (A shares) and Amazon. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Alibaba Group Holding Ltd., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), Facebook, Microsoft, Tesla, and Visa and recommends the following options: long January 2022 $1920 calls on Amazon, short January 2022 $1940 calls on Amazon, long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), and short December 2020 $210 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), and Facebook. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Top 10 - asx shares today
Share Market News

Here are the top 10 ASX shares today

Today, the S&P/ASX 200 Index (ASX: XJO) fought back against the selling pressure throughout the day to finish in the green. …

Read more »

The word inflation written with a ticking time bomb.
Share Market News

Why is it when Jerome Powell sneezes, the ASX 200 catches a cold?

Key points The ASX 200 took a hit following comments from the United States Federal Reserve chair Jerome Powell Expectations …

Read more »

blue arrows representing a rising share price ASX 200
Share Market News

These 3 ASX 200 shares are topping the volume charts this Friday

Finally, a day of green for ASX shares! The S&P/ASX 200 Index (ASX: XJO) is bouncing back strongly today, after a …

Read more »

Young boy wearing suit and glasses adds up on calculator with coins on table
Share Market News

This world-famous fund manager is ‘buying the dip’. Here’s why

Key points Bill Ackman is one of the most famous fund managers in the world He runs Pershing Square Capital …

Read more »

Two male ASX 200 analysts stand in an office looking at various computer screens showing share prices
Share Market News

ASX 200 (ASX:XJO) midday update: ResMed and PointsBet disappoint

At lunch on Friday, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a much-needed positive …

Read more »

A man activates an arrow shooting up into a cloud sign on his phone, indicating share price movement in ASX tech shares
Share Market News

Is the Betashares Nasdaq 100 ETF (ASX:NDQ) an opportunity in this market correction?

Could the Betashares Nasdaq 100 ETF (ASX: NDQ) be a good opportunity during this correction for both the global share …

Read more »

A woman shouts through a megaphone.
Share Market News

2 ASX growth shares to buy in February with 40% upside

If you’re looking to make some additions to your portfolio in February, then the two ASX shares listed below could …

Read more »

Business woman watching stocks and trends while thinking
Share Market News

5 things to watch on the ASX 200 on Friday

On Thursday, the S&P/ASX 200 Index (ASX: XJO) fought hard and was able to record a small gain. The benchmark index rose …

Read more »