The much-touted stock market rotation is fizzling as quickly as it started
==========
Traders pulled $2.6 billion from the iShares Russell 2000 ETF in the five days through Friday, the most in nearly three years; The same stocks that were for weeks finally seeing greater investor interest are now suffering a mass exodus as investors recalibrate their expectations for US economic growth; Short interest as a percentage of shares outstanding on the fund has spiked to its highest level since December; The pullout follows a stretch when traders had been showering money on previously left-for-dead strategies that saw the Russell 2000 rise 10% in July, the biggest monthly gain since the end of last year; The gauge is now off by roughly 8% for August; Investors had gotten excited over small-caps firms, betting that a coming era of lower interest rates, among other factors, would be beneficial; The cohort had previously been shunned for much of the year in favor of the tech behemoths; But big tech took a back seat amid the so-called great rotation, while smaller counterparts started to rally in earnest; Then all of it got repriced once again in recent days after a weaker-than-expected July jobs report reignited fears over the health of the US economy; Amid the turbulence, traders also yanked cash from other corners of the market that tend to benefit during risk-on phases; The iShares iBoxx High Yield Corporate Bond ETF saw a $1.5 billion outflow last week, while the iShares MSCI Emerging Markets ETF notched a nearly $1.2 billion withdrawal, the most since October; Larger-cap indexes held up better relative to the small-cap gauge, with the S&P 500 ending the week little changed
#StockMarket #Rotation #SmallcapStocks #Russell2000Etf #UsEconomy
https://fortune.com/2024/08/12/stock-market-rotation-bust-small-cap-stocks-russell-2000-etf-iwm-economy/
Fortune /
npub1v7…9v0r4
2024-08-12 16:07:00
Author Public Key
npub1v7hvaa8pv7g92sr6na55dtzaxmrrsgddxkhst3e8atw4nxusm37sg9v0r4Published at
2024-08-12 16:07:00Event JSON
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"content": "The much-touted stock market rotation is fizzling as quickly as it started\n==========\n\nTraders pulled $2.6 billion from the iShares Russell 2000 ETF in the five days through Friday, the most in nearly three years; The same stocks that were for weeks finally seeing greater investor interest are now suffering a mass exodus as investors recalibrate their expectations for US economic growth; Short interest as a percentage of shares outstanding on the fund has spiked to its highest level since December; The pullout follows a stretch when traders had been showering money on previously left-for-dead strategies that saw the Russell 2000 rise 10% in July, the biggest monthly gain since the end of last year; The gauge is now off by roughly 8% for August; Investors had gotten excited over small-caps firms, betting that a coming era of lower interest rates, among other factors, would be beneficial; The cohort had previously been shunned for much of the year in favor of the tech behemoths; But big tech took a back seat amid the so-called great rotation, while smaller counterparts started to rally in earnest; Then all of it got repriced once again in recent days after a weaker-than-expected July jobs report reignited fears over the health of the US economy; Amid the turbulence, traders also yanked cash from other corners of the market that tend to benefit during risk-on phases; The iShares iBoxx High Yield Corporate Bond ETF saw a $1.5 billion outflow last week, while the iShares MSCI Emerging Markets ETF notched a nearly $1.2 billion withdrawal, the most since October; Larger-cap indexes held up better relative to the small-cap gauge, with the S\u0026P 500 ending the week little changed\n\n#StockMarket #Rotation #SmallcapStocks #Russell2000Etf #UsEconomy\n\nhttps://fortune.com/2024/08/12/stock-market-rotation-bust-small-cap-stocks-russell-2000-etf-iwm-economy/",
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