Value Stocks Remain Hot in July
 August 1, 2006 — Value stocks remain hot this summer relative to growth stocks as they beat their counterparts at every market capitalization tier for July. The mega-cap Russell Top 200® Value Index, for example, reflected a 3.6% gain in July, while the Russell Top 200® Growth Index lost 1.1% for the month. The mega-cap value index now leads Russell's family of 26 U.S. benchmarks with a year-to-date surge of 10.2%, while its growth counterpart reflects a 3.4% loss for 2006.
"Value has momentum," said Steve Swartley, senior manager research analyst. "Market defensiveness has manifested through value's rise in July and value now maintains a relatively wide year-to-date lead at every level of the market."
Performance numbers for July also show those indexes that track larger stocks outperformed those that reflect stocks with smaller market capitalizations. The Russell Top 50™ Index, which increased 2.6% in July, outperformed the large-cap Russell 1000® Index (0.22%), Russell Midcap® Index (-2.2%), Russell 2000® Index (-3.3%) and Russell Microcap™ Index (-3.7%).
While the broad-market Russell 3000® Index seemed to take a vacation in July with a barely changed return of -0.1%, only six of Russell's indexes reflected a positive return for the month.
"Within the broad market's lackluster performance in July, Russell indexes show a clear tilt toward large caps and value stocks," said Swartley. "The microcap value index (-2.3%), for example, lost about half as much as the microcap growth index (-5.1%), while the small-cap Russell Microcap reflected the worst monthly performance of Russell's core indexes."
Swartley added that the newly launched Russell Microcap™ Value Index now has widened its year-to-date performance gap over the Russell Microcap™ Growth Index to nearly nine percentage points.
Among the 12 sectors in Russell indexes, integrated oils, utilities and health care generally outperformed in July at every market capitalization tier, while autos and transportation, consumer discretionary, materials and processing and producer durables generally underperformed. Autos and transportation, for example, lost 9.1% in the Russell 3000, 11.3% in the Russell 1000 Growth and 6.4% in the Russell 2000 Value.
The top-performing stock for July in the large-cap Russell 1000 was Forest Labs (19.7%), which was followed by Apple Computer (19%) and Idexx Labs (17.8%). On the other end of the performance spectrum, seven of the 20 worst performing stocks were in the technology sector, including PMC-Sierra (-45.6%)
In the Russell 3000, about 61% of the members gained value in July.
In the Russell 2000, only 28 stocks gained more than 20% in July. The top performing stocks were ADVO (47.6%), PETCO (37.4%) and Momenta Pharmaceuticals (36.3%). At the other end of the spectrum, eight of the 20 worst performing stocks are in the technology sector.
.
| RUSSELL INDEXES TOTAL RETURNS (%) |
|
|
|
|
| |
|
July |
|
YTD |
| Russell 3000® Index |
|
-0.09% |
|
3.13% |
| Russell 1000® Index |
|
0.22% |
|
2.98% |
| Russell 2000® Index |
|
-3.25% |
|
4.69% |
| Russell 2500™ Index |
|
-3.15% |
|
2.97% |
| Russell Midcap® Index |
|
-2.19% |
|
2.55% |
| Russell Top 200® Index |
|
1.23% |
|
3.16% |
| Russell Top 50® Index |
|
2.61% |
|
3.97% |
| Russell Microcap™ Index |
|
-3.65% |
|
2.52% |
| Russell 3000® Value Index |
|
-2.07% |
|
9.11% |
| Russell 3000® Growth Index |
|
-2.19% |
|
-2.51% |
| Russell 1000® Value Index |
|
2.43% |
|
9.15% |
| Russell 1000® Growth Index |
|
-1.90% |
|
-2.82% |
| Russell 2000® Value Index |
|
-1.39% |
|
8.90% |
| Russell 2000® Growth Index |
|
-5.19% |
|
0.56% |
| Russell 2500™ Value Index |
|
-1.39% |
|
6.17% |
| Russell 2500™ Growth Index |
|
-4.87% |
|
-0.14% |
| Russell Midcap® Value Index |
|
-0.57% |
|
6.41% |
| Russell Midcap® Growth Index |
|
-3.58% |
|
-1.12% |
| Russell Top 200® Value Index |
|
3.59% |
|
10.17% |
| Russell Top 200® Growth Index |
|
-1.14% |
|
-3.39% |
July 2006
SECTOR PERFORMANCE |
|
|
|
|
| |
|
Russell 1000 Growth |
|
Russell 1000 Value |
| Technology |
|
-3.01% |
|
-1.37% |
| Health Care |
|
4.38% |
|
5.95% |
| Consumer Discretionary & Services |
|
-6.74% |
|
-2.97% |
| Consumer Staples |
|
3.67% |
|
3.59% |
| Integrated Oils |
|
10.42% |
|
7.87% |
| Other Energy |
|
-2.04% |
|
2.34% |
| Materials & Processing |
|
-3.38% |
|
-3.32% |
| Producer Durables |
|
-3.69% |
|
-4.46% |
| Autos & Transportation |
|
-11.32% |
|
-4.14% |
| Financial Services |
|
-1.05% |
|
2.42% |
| Utilities |
|
3.22% |
|
4.91% |
About Russell: Russell Investment Group, a global leader in multi-manager investing, provides investment products and services in 44 countries. Russell manages more than $171 billion in assets and advises clients worldwide representing more than $2.4 trillion. Founded in 1936, Russell is a subsidiary of Northwestern Mutual and is headquartered in Tacoma, Wash., with additional offices in New York, Toronto, London, Paris, Sydney, Singapore, Auckland and Tokyo.
Russell employs its indexes to objectively evaluate investment managers for multi-manager funds and other investment services. More than $3.8 trillion in assets are benchmarked to the industry-leading Russell indexes.
Russell Investment Group, a Washington, USA corporation, operates through subsidiaries worldwide. Russell Investment Group is a subsidiary of The Northwestern Mutual Life Insurance Company.
Russell Investment Group is the owner of the trademarks, service marks and copyrights related to its indexes.
Russell's indexes are unmanaged and cannot be invested in directly.
RC# 4463
|
