Riskiest Stocks Begin an Epic Rotation With Rate Cuts in Sight
- Russell 2000 is notches its best five-session run since 2020
- CPI reading launched small cap rally as two-year yield plunged
The small-capitalization Russell 2000 Index is up 10% in the past five sessions, something it hasn’t done since April 2020.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
The most speculative corner of the stock market is soaring at a pace not seen since the pandemic as traders race to move up their rate cut bets in a risk-on signal for the investment community.
The small-capitalization Russell 2000 Index is up 12% in the last five sessions, something it hasn’t done since April 2020, while the S&P 500 Index has gained just 1.6% over that time, and the technology-heavy Nasdaq 100 Index is down 0.3%. What’s more, the largest exchange-traded fund tracking the Russell posted the second-biggest inflow among equity ETFs last week.