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Small Caps, Value Stocks Turn Cold in November
Russell Global Small Cap Index reflects 7.5% loss for the month
December 3, 2007 — Value stocks continued to lose ground during November and, at month's end, the broad-market Russell 3000® Value Index reflected a year-to-date negative return for 2007. For the first 11 months of 2007 the Russell 3000® Growth Index led its value counterpart by nearly 12 percentage points: 11.7% to -0.1, respectively.
In addition, the small-cap Russell 2000® Index reflected a 7.2% loss for the month and it's year-to-date return (-1.5%) fell into negative territory.
"Ongoing turmoil in the credit situation has created a winter of discontent for investors, particularly in the small-cap segment," said Steve Wood, senior portfolio strategist at Russell. "Every sector in the Russell 2000 shows a negative return for November and the financial services sector has suffered a 15% year-to-date decline."
Total returns for November show the best-performing U.S. equity benchmark was the Russell Top 200® Growth Index (-3.4%), which also led all other U.S. market segments with the best year-to-date gain through November of 12.9%. The smallest stocks, as reflected by the Russell Microcap® Index (-8.6%), turned in the worst performance for the month as the Russell Microcap® Value Index (-12.6%) ranked lowest in terms of year-to-date return through November.
Looking at the global picture, the Russell Global Index (-4.6%), which includes the Russell Developed Index (-4.3%) and Russell Emerging Markets Index (-6.7%), reflected a negative return for the month after posting strong numbers for much of 2007.
"The global market didn't offer many bright spots for investors in November, but the year-to-date figures across the board remain relatively strong," Wood said. "The Russell Global Small Cap Index reflected a 10.8% year-to-date gain through November, even though it gave back 7.5% for the month."
Sector returns for the U.S. market as measured by the Russell 3000 show only consumer staples (2.9%) and heath care (0.4%) gained some value in November, while technology was hit with a loss of 8.4%.
In the Russell 3000, 78% of stocks had a negative return for November.
In the Russell 1000® Index, four of the five top-performing stocks are health care firms, including Wellcare Group (60.9%), Tenet Healthcare (57%) and Abraxis BioScience (54.7%). However, 50 stocks lost more than 20% each for the month. In the Russell 2000, a health care stock, United Therapeutics (46.2%), led the index, while 11 financial services firms each lost more than 40% for the month.
Russell 2000 Index:
Sector returns through Nov. 30 |
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November |
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YTD 2007 |
| Technology |
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-10.01% |
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5.90% |
| Health Care |
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-3.77% |
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10.63% |
| Consumer Discretionary & Services |
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-8.77% |
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-8.2% |
| Consumer Staples |
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-4.19% |
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7.45% |
| Integrated Oils |
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-17.06% |
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-24.97% |
| Other Energy |
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-8.12% |
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11.30% |
| Materials & Processing |
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-7.02% |
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11.44% |
| Producer Durables |
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-6.16% |
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3.39% |
| Autos & Transportation |
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-12.23% |
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-8.92% |
| Financial Services |
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-6.04% |
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-14.96% |
| Utilities |
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-4.94% |
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0.18% |
For additional performance figures on Russell's indexes and the user-friendly Russell index returns calculator, please visit: www.russell.com/Indexes.
About Russell: Russell Investments provides strategic advice, world-class implementation, state-of-the-art performance benchmarks and a range of institutional-quality investment products. Russell has more than $231 billion in assets under management as of Sept. 30, 2007, and serves individual, institutional and advisor clients in more than 40 countries. Russell's industry-leading indexes have $4.4 trillion in assets benchmarked to them. Founded in 1936, Russell is a subsidiary of The Northwestern Mutual Life Insurance Company. Headquartered in Tacoma, Wash., Russell has additional offices in Amsterdam, Auckland, Hong Kong, Johannesburg, London, Melbourne, New York, Paris, San Francisco, Singapore, Sydney, Tokyo and Toronto.
Contacts:
Steve Claiborne, 253-439-1858
RC#4812
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