FSGS - Correction For Large, Near-Bear For Small

2025-03-15 03:30:00 ET

Summary

• As of Thursday’s close, the S&P Small Cap 600 index was down -19.2 percent from the November 25 high, just shy of the technical bear market threshold of minus 20 percent.
• By comparison, the S&P 500 index of large-cap stocks was down a bit over ten percent on Thursday from its last record high of February 19.
• The relatively poor performance of small-cap stocks in this environment is perhaps unsurprising.

The economic uncertainty we talked about in last week’s commentary has led to a turn for the worse in financial markets this week, and for one asset class, in particular. Small-cap US stocks last set a record high in late November last year, as unbridled optimism among small businesses in the immediate post-election environment led to a burst of outperformance against their large cap counterparts....

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