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Apple, Tesla stock splits surge market caps

Apple, Tesla stock splits surge market caps
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Apple's and Tesla's market caps both hit record highs Monday after their stock splits went into effect, overwhelming major trading platforms in the process.

Monday was the fifth time that Apple split stocks, a process whereby companies break up individual shares into more affordable chunks.

Apple shares have grown nearly 5 percent, to $130.80 each, since the Silicon Valley stalwart split its shares in four, raising the company's market valuation to $2.2 trillion as of 2 p.m.

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The technology giant became the first American company to reach a market cap of $2 trillion earlier this month.

Tesla's stock split, which it announced Friday, is a first in the electric car manufacturer's history.

On the first day of trading after the 5-for-1 split, shares rose nearly 10 percent to roughly $487 each as of 2 p.m.

That surge was enough to push Tesla CEO Elon MuskElon Reeve MuskBlue Origin takes one small step toward being a competitor to SpaceX Virgin Hyperloop to build new certification center in West Virginia SpaceX awarded contract to build US military tracking satellites MORE past Facebook's Mark ZuckerbergMark Elliot ZuckerbergHillicon Valley: Big Tech hearing the most partisan yet | Rubio warns about foreign election interference | Trump campaign site briefly hacked Tech CEOs clash with lawmakers in contentious hearing Cruz in heated exchange with Twitter's Dorsey: 'Who the hell elected you?' MORE to be the world's third richest person, at least temporarily.

"The reactions of these stocks that split I think speaks to a broader appetite for tech stocks," Wedbush Securities equity analyst Dan Ives told The Hill.

"This is a trend we expect from more tech companies as the strong have gotten stronger during this COVID pandemic," he added.

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Tech companies have flourished during the coronavirus pandemic, even as millions have lost their jobs and thousands of businesses have gone under.

The five biggest companies in the sector Apple, Amazon, Microsoft, Alphabet and Facebook now constitute 20 percent of the S&P 500, one of the few indexes that have maintained strong growth all year.

The rush to acquire Apple and Tesla stocks at significantly reduced prices Monday morning was enough to temporarily take down some major trading platforms, including Charles Schwab, Vanguard and TD Ameritrade.

Robinhood, a wildly popular fee-free trading app, also had limited functionality in the morning.