SOURCE: Russell Investments

Russell Investments

July 16, 2013 17:17 ET

Healthcare, Consumer Discretionary Sectors Leading Russell 2000's 23.7% YTD Return, Historic Highs

SEATTLE, WA--(Marketwired - Jul 16, 2013) - Ahead of Federal Open Market Committee (FOMC) Chairman Bernanke's semi-annual Congressional Testimony and several corporate earnings reports, the Russell 2000® Index of small-cap U.S. stocks returned 23.7% YTD and 6.8% in July as of July 15th. Thus far in 2013, the Index has reached several new all-time historical highs, with the most recent all-time high occurring on Monday, July 15th.

The Consumer Story:

Two out of three leading sectors in the Index year-to-date have been consumer-related. The Healthcare sector (32.7%) has led year-to-date within the Index, followed by the Consumer Discretionary (31.6%) and Consumer Staples (31.1% sectors).

Energy company Sunpower Corp. (380.2%), healthcare company Clovis Oncology Inc. (366.0%) and utility company Inteliquent, Inc. (326.2%) lead Index company constituents in year-to-date performance as of July 15th.

Also, within the Index, dynamic stocks have outpaced defensive stocks year-to-date as of July 15th, with a 25.0% return for the Russell 2000 Dynamic Index relative to a 22.4% return for the Russell 2000 Defensive Index.

Market Implications:

"The strong run in 2013 by small-cap US stocks has been led by consumer-related sectors, as shown by the Russell 2000 Index's sector performance year-to-date, alongside broader sector rallies. And, year-to-date, small cap investors have favored more dynamic stocks," said Stephen Wood, Chief Market Strategist for Russell Investments. "With uncertainty swirling in China, Europe, Emerging Markets, and commodities, US small-cap stocks have benefited from the relative strength of the US economy, a still very accommodative Fed, nascent fiscal improvement, and softening -- yet positive -- corporate earnings reports."

Russell 2000 Index, Sector, Constituent Returns
Index / Index Sector July Month-To-Date as of July 15th 2013 YTD as of July 15th
Russell 2000 Index 6.8% 23.7%
Russell 2000 Defensive Index 6.5% 22.4%
Russell 2000 Dynamic Index 7.1% 25.0%
Russell 2000 Health Care Sector 9.2% 32.7%
Russell 2000 Consumer Discretionary Sector 6.7% 31.6%
Russell 2000 Consumer Staples Sector 6.8% 31.1%
Russell 2000 Producer Durables Sector 6.5% 23.9%
Russell 2000 Technology Sector 7.2% 23.9%
Russell 2000 Utilities Sector 7.7% 20.1%
Russell 2000 Financial Services Sector 5.5% 19.8%
Russell 2000 Energy Sector 6.1% 17.6%
Russell 2000 Materials & Processing Sector 6.7% 10.3%
Sunpower Corp. N/A 380.2%
Clovis Oncology Inc. N/A 366.0%
Inteliquent Inc. N/A 326.2%
AVEO Pharmaceuticals Inc. N/A -67.7%
Atlantic Power Corp. N/A -59.1%
Dynavax Technologies Corp. N/A -53.8%

Source: Russell Investments. Returns are denominated in US dollars.

Please note: Indexes are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Russell's publication of the Indexes or Index constituents in no way suggests or implies a representation or opinion by Russell as to the attractiveness of investing in a particular security. Inclusion of a security in an Index is not a promotion, sponsorship or endorsement of a security by Russell and Russell makes no representation, warranty or guarantee with respect to the performance of any security included in a Russell Index.

Opinions expressed by Mr.Wood reflect market performance and observations as of July 15th, 2013 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance

This material is not an offer, solicitation or recommendation to purchase any security.

Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional. The information, analysis and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual entity.

Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company.