U.S. equities markets have continued to be strong as we move through the third quarter. All major indices are up year-to-date. Distribution days, as calculated under the O’Neil Methodology, continue to be low across most indices. Large capitalization stocks continue to lead with growth stocks being favored. The top two sectors remain Technology (+16.34% YTD) and Health Care (+15.44% YTD). Small capitalization stocks continue to lag as evidenced by the Russell 2000’s performance. Generally, U.S. small capitalization stocks have higher exposure to the domestic economy than their large capitalization counterparts. Continuing lackluster U.S. economic growth may be the source of small capitalization stock underperformance.
