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Stock Market Sees Unusual Shift: Small-Caps Surge, Tech Stocks Struggle
Thursday brought a rare and intriguing day in the stock market, marked by a significant divergence in performance between small-cap and large-cap technology stocks. The Russell 2000, a small-cap index, surged over 3%, while the S&P 500 and Nasdaq Composite, heavily influenced by tech stocks, experienced declines. This unusual dynamic has sparked optimism among financial experts, who see it as a potential sign of a market rotation away from dominant tech stocks and towards other sectors.
The S&P 500 suffered its worst day since April, closing down 0.88%, with the Nasdaq Composite dropping 1.95%. Prominent tech stocks like $NVIDIA and $Meta Platforms led the decline, with $NVIDIA falling 5.6% and $Meta Platforms decreasing 4.1%. The Dow Jones Average, however, managed to edge up by 0.08%.
This shift in market dynamics follows the release of the June consumer price index report, which showed a slight decrease in headline inflation. The decline in inflation has led investors to anticipate potential interest rate reductions by the Federal Reserve, driving them towards sectors expected to benefit from such a move. Small-cap stocks, in particular, have gained traction, with the Russell 2000 surging 3.6%.
Warren Pies, co-founder of 3Four Research, suggests that this market rotation could be indicative of trends expected in the latter part of the year. He highlights that upcoming corporate earnings releases and a narrative of credit expansion are likely to drive the market until year-end.
Looking ahead, several major financial institutions, including $JPMorgan Chase, $Wells Fargo, and $Citigroup, are slated to announce their quarterly results before the market opens on Friday. Additionally, traders are awaiting the producer price index figures for June and the preliminary consumer sentiment data from the University of Michigan for July.
Original Article: https://www.cnbc.com/2024/07/11/stock-market-today-live-updates.html
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