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Shift from megacap to small caps since soft inflation data
The Russell 2000 outperforms Nasdaq 100 by nearly 12 points last week, best since April 2020.
Federal Reserve rate cuts expected to benefit smaller cap stocks, less reliant on tech
Bitcoin fell 2% to $66,767 despite Biden withdraw
Gold continued to trend below the $2,400
The Russell 2000
Wall Street has continued its trend of shifting investments from mega cap "safety" stocks to small caps since the US soft inflation data.
The Russell 2000 has outperformed the Nasdaq 100 by nearly 12 percentage points last week, a feat not seen since 2011, marking its best performance since April 2020. The anticipated rate cuts from the Federal Reserve are expected to benefit smaller cap stocks, which are less reliant on the tech sector.
US politics
Republican candidate Donald Trump widened his lead in the 2024 presidential race following his official nomination at the Republican National Convention last week, according to a HarrisX/Forbes poll.
A survey conducted between July 19-21 showed Trump leading Biden and Harris by six percentage points, 54% to 47%, up two points from a July 13-15 poll.
Crypto
The market reaction to U.S. President Joe Biden's decision to withdraw from the election race over the weekend was subdued. While bitcoin's rally temporarily stalled.
Bitcoin fell 2% to $66,767, retreating from an over one-month top hit in the previous session.
Gold
Gold continued to trend below the $2,400, testing a key support near $2,384, as markets await PCE data later this week and a slew of earning reports from major tech.
