A Fed interest-rate cut could make small-cap stocks a good investment now
Market Extra
Small-cap stocks are facing a fog of uncertainty on the U.S. economy and Fed policy, analysts say
Published:
U.S. small-cap stocks have staged an epic rally over the past month with the Federal Reserve set to cut interest rates for the first time since 2020 — but uncertainty on the economic and monetary-policy outlook still has investors fretting over whether gains can be sustained in one of the most roughed-up corners of the market.
The small-cap Russell 2000 Index RUT — which measures the performance of 2,000 small and midsized companies in the Russell 3000 Index RUA — rose more than 2% over the past month, outperforming the 1.4% advance of the large-cap benchmark S&P 500 SPX and the 0.2% decline of the tech-heavy Nasdaq Composite COMP in the same period, according to FactSet data.