Last week was a rough one for the major stock market indexes, with both the S&P 500 and the Dow Jones industrial average losing 1 percent of their value. The S&P is now down 6.2 percent from the high it set a month ago, on September 18; the Dow is down 5.2 percent from its September high.
But it's important to remember that those two indexes aren't the entire market. The Russell 2000 - the most widely used benchmark for small-cap stocks - had a good week, rising by 2.8 percent. In contrast, while the large-cap indexes were doing well for most of the summer, the small caps were suffering, dropping 13 percent between early July and the beginning of last week.
We expect small-cap stocks to be more volatile than large caps, and the Russell 2000 is still down nearly 6 percent on the year. But we may be seeing that particular asset class finally start to turn the corner.
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