News – US – Historic small stocks gains underscore investor exuberance


Small company stocks have outperformed their larger counterparts by the biggest lead behind their rise for more than two decades: Investor confidence that strong momentum and the use of coronavirus vaccines will boost the economy

The Russell 2000 Small Business Index is up 15% and has set 10 closing records so far this year, well above the 4% increase in the S&P 500, the largest such gap between the two indices since February 19 2000 according to Dow Jones Market Data

Small Business Leadership Goes Back Farther In the past six months, they have outperformed the S&P 500 by nearly 30 percentage points as investors expect higher household spending from the Biden administration

One of the biggest winners is the hydrogen fuel cell company Plug Power Inc, Fast food chain Red Robin Gourmet Burgers Inc and retailer Macy’s Inc All three stocks have more than doubled in the past six months, rising at least 30% in 2021

Smaller companies are more closely tied to the domestic economy than their large cap counterparts that make more money overseas, economically sensitive sectors like energy, materials, and banking also make up more of Russell than larger indices, these cyclical groups have been hit by the pandemic , but are now bringing the markets to record levels

Stock, S&P 500, Russell 2000 Index, Nasdaq, S&P Global Ratings, Small Cap Companies, Stock Market Index, Dow Jones Industrial Average

News – USA – Historic gains in small stocks mark The exuberance of investors