US small cap stocks hit record high

Mon, 11/25/2024

by Ellie LeTu

Source: Financial Times

• Russell 2000 hits all time high

  • Russell 2000 (measuring 2000 smallest publicly traded companies) is a proxy for how small cap stocks are performing.

  • Rose more than 2% to an all time high of 2466.48.

  • Index has climbed more than 10% since Trump’s election victory.

  • Previous peak was set in November 2021.

• Benefiting from the upcoming political scene

  • Small domestic companies stand to benefit from Republican policies.

    • Corporate tax cuts

    • Deregulation

  • Trump’s selection of Scott Bessent for treasury secretary has eased widespread tariff concerns.

• Upcoming big bounce back

  • Russell 2000 was badly hit over the past few years.

  • Rising interest rates and recession fears affect small companies more.

    • Smaller companies tend to have higher levels of indebtedness and are more exposed to the US economy.