Stifel sees small caps rising through year end

Aug. 27, 2018 2:37 PM ETIJS, VBR, VBK, RVT, IWN, FFTY, IWO, EES, IJT, SLYG, SLYV, RZV, FNDA, VIOG, VIOV, VTWG, RCG, RZG, ISCV, VTWV, XSVM, TILT, ISCG, FYT, VLU, FYC, XSMO, JSML, DESC, USVMBy: Liz Kiesche, SA News Editor5 Comments
  • Small-cap stocks' gains this year will continue for the rest of the year on strong financial performance and the benefits of tax reform, CNBC reports, citing a Stifel note to investors.
  • Last December, the U.S. corporate tax rate was permanently cut to 21% from 35%.
  • "As we move into the second half of the year, the market environment is positioned well for U.S. small cap equities to remain one of the preferred markets," global head of investment strategy Michael O'Keeffe said in a note to clients.
  • Small business owners expect increased sales and even better business conditions for the rest of year, which should boost investment spending and help fuel GDP growth, O'Keeffe wrote.
  • With generally less exposure to international markets than companies in the S&P 500, they'll do better if the trade environment deteriorates, he said.
  • The Russell 200 has risen 12.8% YTD, compared with the S&P 500 Index, which is up 8.3% in the same period. the Russell 200 Index is up 0.35% to 1,731.69 on Monday, while the S&P is up 0.7% to 2,895.57 after President Trump announced a trade pact with Mexico.
  • ETFs: IJS, VBR, VBK, RVT, IWN, FFTY, IWO, EES, IJT, SLYG, SLYV, RZV, FNDA, VIOG, VIOV, VTWG, RCG, RZG, JKL, VTWV, PXSV, TILT, JKK, FYT, VLU, FYC, PXSG-OLD, JSML, DESC, USVM
  • Previously: Small-cap and mid-cap indexes hit records, as S&P trails (Aug. 7)

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