Economics
Meltdown of America-First Strategy Puts Small-Caps on a Tough Turnaround Path
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The rise and fall of small-cap U.S. stocks was one of the most jarring market reversals this year. And 2019 is expected to only bring a modest recovery thanks to pressure from higher interest rates and concerns about peaking earnings growth.
Investing in smaller, domestically focused companies had been among most popular strategies in 2018, as tariff tensions and a fiscal stimulus boost made them into safe havens. But the so-called America First trade has completely unwound. The Russell 2000 Index has plunged 16 percent from an August record and is on track for the first annual decline since 2015.