Amidst the resounding fanfare surrounding the Nasdaq 100’s record-breaking surge, U.S. small-cap stocks have quietly carved out their own moment of glory.
Rally Record: The Russell 2000 index, closely monitored through the iShares Russell 2000 ETF IWM, has experienced a remarkable year-end rally, reaching levels not witnessed since August 2022.
Consistent Climb: This class of stocks has been riding a six-week winning streak, their longest since December 2020, reflecting a sweeping advance rather than isolated successes.
Bullish Breadth: What’s particularly striking is the breadth of this rally, with over 80% of the stocks within the Russell index, accounting for approximately 1,600 companies, trading above their respective 50-day moving averages. This indicates a robust performance across a wide spectrum of small-cap stocks, rather than being limited to a select few.
Outperformance vs. Large Caps: After lagging behind in terms of performance for much of the year, small caps have sharply outperformed their large-cap counterparts in December. The iShares Russell 2000 ETF has surged by an impressive 11.4% during the month. In contrast, the SPDR S&P 500 ETF Trust SPY and the SPDR Dow Jones Industrial Average ETF DIA have both seen a modest 3.9% increase, while the tech-heavy Invesco QQQ Trust QQQ, which tracks the Nasdaq 100 index, is up by 5.5%.
Read Also: Small Caps Are ‘Outperforming Everything,’ Analyst Says: This Rally’s Been ‘Years In The Making’
3 Charts Show The Small Caps’ Outstanding Rally In December
1) Small Caps Outperform Large Caps
2) More Than 80% Of Russell 2000’s Stocks Trade Above The 50-Day Moving Average
3) Small Caps Are On The Longest Winning Streak In Three Years
Russell 2000’s Top Gainers In December 2023
Here are the top 10 month-to-date performers in the Russell 2000 as of December 19, 2023:
| Name | Industry | Market Cap | Price Chg. % (MTD) |
|---|---|---|---|
| EyePoint Pharmaceuticals, Inc. EYPT | Pharmaceuticals | $936.78M | 218.40% |
| Hawaiian Holdings, Inc. HA | Passenger Airlines | $701.19M | 202.45% |
| Altimmune, Inc. ALT | Biotechnology | $427.68M | 151.90% |
| 2seventy bio, Inc. TSVT | Biotechnology | $184.02M | 98.63% |
| Aurora Innovation, Inc. AUR | Software | $6.54B | 96.58% |
| Carvana Co. CVNA | Specialty Retail | $12.14B | 92.53% |
| Purple Innovation, Inc. PRPL | Household Durables | $122.14M | 86.17% |
| Marathon Digital Holdings, Inc. MARA | Software | $4.93B | 85.13% |
| MBIA Inc. MBI | Insurance | $683.22M | 84.53% |
| Century Therapeutics, Inc. IPSC | Biotechnology | $148.99M | 81.75% |
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