The Stealth Bear

When we look at “the stock market,” we’re usually talking about an index of stocks. Sometimes that isn’t the entire picture. Bloomberg notes that nearly half of the stocks in the Nasdaq are 20% or more off their high, which is the usual definition of a bear market.

About 47 percent of stocks in the Nasdaq Composite (CCMP) Index are down at least 20 percent from their peak in the last 12 months while more than 40 percent have fallen that much in the Russell 2000 Index and the Bloomberg IPO Index. That contrasts with the Standard & Poor’s 500 Index (SPX), which has closed at new highs 33 times in 2014 and where less than 6 percent of companies are in bear markets, data compiled by Bloomberg show.

This is a direct result of the flagging performance of small-cap stocks.

Posted by on September 16th, 2014 at 12:19 pm


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