Average Distance from 52-Week Highs: Financials Showing Improvement

While today's rally in the market has brought the major indices to their highest levels since early January, the average stock still remains well below its 52-week high. In the chart to the right, we calculated how much the average stock is trading below its 52-week high. Overall, the average stock in the S&P 1500 is currently trading 27% below its high over the last year. While small caps have been the hardest hit with an average decline of 31.1%, large cap stocks have held up the best with a more modest decline of 23.1%.

On a sector basis, it comes as little surprise that Consumer Discretionary stocks are the furthest below their 52-week highs (-35.0%) given that many of the market's problems can be traced back to the consumer. Somewhat more surprising, however, are the Financial stocks, where the average stock is 29.2% below its 52-week high. While the Financials were among the hardest hit late last year and early this year, there are now three other sectors (Telecom Services, Consumer Discretionary, and Technology) where the average stock is down by a larger margin. Additionally, the average stock's decline from its 52-week high in the Financial sector is only 220 basis points more than the average overall decline of 27%.