Tuesday was seemingly humdrum day in the markets with the S&P 500 (up 0.24%), Dow Industrials (up 0.03%) and Nasdaq (up 0.36%) barely moving. However, it was a huge day for smaller names.
The Russell 2000 (up 2.7%) hit a 3-month high and is now up 6.02% year to date as investors and markets reassess prospects for small-caps. It was an even bigger day for the Russell Microcap Index (up 2.77%), which was pushed into positive territory (up 2.44%) for the year.
What's more, the rallies were driven by value as the Russell 2000 Value Index (up 3.1%) and Russell Microcap Value Index (up 3.12%) upstaged Russell 2000 Growth (up 2.35%) and Russell Microcap Growth (up 2.29%).
There are still huge gaps to fill. However, in growth versus value year to date in 2023:
- Russell 1000 Growth (up 23.78%) is ahead of Russell 1000 Value (up 1.47%) by 2,231 basis points
- Russell 2000 Growth (up 10.76%) is ahead of Russell 2000 Value (up 1.19%) by 957 basis points
- Russell Microcap Growth (up 7.56%) is ahead of Russell Microcap Value (down 0.9%) by 846 basis points
What's more, Tuesday was a good-old fashioned, lower-quality rally as select deeper value names (or some which may be on the verge of being deep-sixed depending on your perspective) enjoyed relatively big jumps.
Specialty retailers G-III Apparel (GIII) (up 28%) and Fossil Group (FOSL) (up 8%), net/net Acacia Research (ACTG) (up 5%), restaurant name BurgerFi International (BFI) (up 10%), fashion retailers Cato Corp. (CATO) (up 5%) and Chico's FAS (CHS) (up 10%), Argentine farming and real estate name Cresud (CRESY) (up 6%), private corrections name CoreCivic (CXW) (up 7%), movie theater/real estate company Reading International (RDI) (up 8%), construction name and net/net Tutor Perini (TPC) (up 7%) and boating retailer MarineMax (HZO) (up 9%) all enjoyed yesterday's action, and the list goes on.
We'll see if smaller names, and specifically small value, can continue to get back on track in what has been a very challenging year.
(Please note that due to factors including low market capitalization and/or insufficient public float, we consider FOSL, BFI, CATO and RDI to be micro-caps stock. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.)