|Day's Range||1,505.88 - 1,516.66|
|52 Week Range||1,266.92 - 1,742.09|
One of the highest trading-volume days on U.S. stock markets each year falls in late June, when FTSE Russell rebalances its closely followed collection of U.S. equity indexes
Stocks in the Russell 2000 Index were among the hardest hit in a broad equity rout as traders dug in for a protracted dispute between the U.S. and China. A tumble of as much as 1.9% had the gauge poised to close below its 50-day, 100-day and 200-day moving averages for the first time since the market recovered from last year’s sell-off. The rationale was that smaller U.S. companies that get a lesser portion of their sales from overseas won’t be as hurt by tariffs.
As investors try to cope with the ongoing U.S.-China trade war, BofA-Merrill Lynch is telling investors to resist the temptation to invest in small cap stocks. Jill Carey Hall, the firm's small cap expert, warns the widely held perception they're insulated from the effects is ill-conceived — adding fundamentals in the space remain challenged. "Small cap earnings have been coming in in-line with expectations.
Ares Management Corp. is among stocks likely to join the Russell 1000 of large-caps and EXP World Holdings Inc. will be one of those added to the Russell 2000 of smaller firms, KBW said. The projections came after FTSE Russell on Friday kicked off a seven-week process in which stocks are shuffled based on their market capitalization. FTSE Russell’s gauges are benchmarked by $16 trillion of money globally.
STOCK ALERT 3:30 p.m. At 12:01 a.m. ET Friday morning, tariffs on $200 billion of Chinese goods imported to the U.S. rose to 25%, sending stocks down at Friday’s open. A presidential tweet suggesting that negotiators from the world’s two largest economies were in no rush to reach a deal pushed them further into the red.
The Russell 2000 Index fell back into correction territory Thursday as Wall Street waits to see if the U.S. and China can resolve its issues on trade. "Small caps are most sensitive to overall economic growth," said Tom Essaye, founder of Sevens Report Research. Small caps were having the best start to the year since 1987.
Renewed trade fears weigh on stocks, Liu He is still expected in Washington but an end to trade disputes is far from likely.
As the S&P 500 Index slumped less than 0.5 percent Monday, global equities fared much worse, with one measure posting the biggest loss in six weeks. The Russell 2000 outperformed China’s Shanghai Composite Index by the most since February 2016. U.S. “markets have been exerting restraint in not overreacting -- the ‘we have seen this movie before’ appears to be a market narrative, with both the price action and the dispersion across risk assets not catching up with the drama in China,’’ wrote Michael Purves, the chief global strategist at Weeden & Co.
Small-cap stocks are thought to be more exposed to the U.S. economy than their larger counterparts, so their rise might indicate that investors are more worried about economic growth abroad than at home.
Fed Chairman Powell, as history has told us before, failed to deliver in the short term for the stock market (not that that is his job), adding yet another down session for equities on decision day (just one of the 10 meetings over which he has presided led to the SPX ending higher). The consensus from the FOMC meeting was that prospects for a rate cut (did we really think that was coming?) are now fading. Fed fund futures were anticipating a near 24% chance of a rate cut in June, and a slightly higher chance (32%) in July -- those are now ~6% and 16% respectively.
The stock market is red hot right now. The S&P 500 is having its best start to the year in 32 years. "If we see the breakout above that September high, which was right around 2,941 — if that breakout is confirmed meaning we spend more than just a week above it, then we should see long term follow through on the back of that breakout," Fairlead Strategies' Katie Stockton said Tuesday on CNBC's "Trading Nation" segment.
The US stock markets took a nosedive early in the regular trading session after the QQQ briefly advanced to new All-Time Highs yesterday’s morning. With the QQQ and other symbols nearing fresh new highs, traders should expect volatility to increase as trading systems and traders to look for any signs of a top to set up.