And just like that, the S&P 500 has just about come full circle. The index is still down 1% year to date and 6% off its all-time high, but this is madness. The chart very much looks like a "V," as in the "V-shaped" economic recovery for which many are hoping. I wonder where the S&P might be had the pandemic never occurred, but we'll never know the answer to that one.
Getting to this point, from the all-time high on Feb. 19 to back within 6% of it, has been a wild ride. In the last 75 trading days the S&P 500 has closed up or down at least 1% during 54 sessions, an incredible 72% of the time. That stretch has included nine days that the index closed up or down at least 5% (five positive, four negative), 16 days with moves of 4% or greater (eight positive, eight negative), and 25 days of moves greater than 3% (12 positive, 13 negative).
All that movement, all those gyrations, all the fear and anxiety one day coupled with euphoria the next, in just 75 trading days to essentially get back to where we started 2020. Of course, this chapter is not yet over, and I'm sure we are in store for a few more surprises along the way.
However, broad market performance, as usual, does not tell the whole story. My favorite market subculture, value, continues to lag. If you just look at quarter-to-date numbers, value has done well in absolute terms as measured by the Russell 1000 Value Index (up 23.8%), Russell 2000 Value Index (up 28.8%) and Russell Microcap Value Index (up 28.5%). While each still trails its growth index counterpart by 2.7%, 4.1%, and 8.5%, respectively, the performance gap has narrowed.
Year to date, however, the performance spreads between growth and value are still wide enough to drive a truck through. During that time frame the Russell 1000 Growth is beating the Russell 1000 Value by 18%, the Russell 2000 Growth is besting the Russell 2000 Value by 15.8%, and in microcap land the Russell Micro Growth has an 18.4% advantage of its value brother. Large growth (the Russell 1000 Growth) is beating small value (Russell 2000 Value) by 25.8%. Despite markets moving significantly higher since I last wrote on this subject in early May, that spread, which was 26.6% on May 1, has not moved very much.
Just when you thought you'd seen it all and understood what truly drives the markets, they throw you a new type of curveball, but that's why all of this never, ever gets boring.