Small-Cap Stocks Getting Crushed Across Sectors

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Includes: BIBL, BXUB, BXUC, CHGX, CRF, DDM, DIA, DMRL, DOG, DUSA, DXD, EDOW, EEH, EPS, EQL, EQWS, ESGL, FEX, FLQS, FWDD, FYX, GSEW, HUSV, IVV, IWL, IWM, JHML, JKD, JKJ, OMFS, OTPIX, PBSM, PMOM, PPLC, PSQ, QID-OLD, QLD, QQEW, QQQ, QQQE, QQXT, RSP, RVRS, RWM, RYARX, RYRSX, SCAP, SCHA, SCHX, SDOW, SDS, SFLA, SH, SMLF, SMLL, SPDN, SPLX, SPSM, SPUU, SPXE, SPXL, SPXN, SPXS, SPXT, SPXU-OLD, SPXV, SPY, SQQQ, SRTY, SSO, SYE, TNA, TQQQ, TWM, TZA, UDOW, UDPIX, UPRO, URTY, USA, USMC, USSD, USWD, UWM, VB, VFINX, VOO, VTWO, VV, ZF
by: Bespoke Investment Group

In a post yesterday, we highlighted the fact that while large-cap stocks in the S&P 500 were down an average of 13.2% from their 52-week highs, small-cap stocks were faring much worse, with stocks in the S&P 600 Small Cap index down an average of over 20% from their respective highs. Today, we wanted to go into a little more detail on these market cap divergences by looking at how far stocks are down from their 52-week highs within individual sectors.

While small-cap stocks are down an average of 20.7% from their 52-week highs, small-cap Technology, Consumer Discretionary, and Health Care stocks are down an average of much more. In the Technology sector, for example, the average spread between where individual small-cap tech stocks are trading relative to their 52-week highs is 26.7%, while in the Consumer Discretionary sector, that same spread is just over 25%. While stocks in these sectors have sold off sharply from their 52-week highs, stocks in the Utilities sector are down less than 5% on average from their 52-week highs. Utilities is also the only sector where the average small-cap stock is down less from its 52-week high than the average large-cap stock in the sector.

Speaking of large caps, stocks in the Consumer Discretionary and Materials sector are trading down the furthest from their 52-week highs (~18%), while Utilities (-7.4%), Energy (-9.9%), and Real Estate (-9.95%) are the only three sectors where stocks are down less than 10%, on average, from their 52-week highs.