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Small caps rise in August
Financial services sector in Russell 2000 gains 4.8% for the month
September 2, 2008 — The small-cap Russell 2000® Index reflected a 3.6% increase for August as every sector offered a positive return for the month. However, in the large-cap Russell 1000® Index, three sectors including financial services turned in a negative return for August.
"Small caps now have outperformed large caps for four consecutive months," said Christian Anderson, associate portfolio manager at Russell Investments. "The disparity in year-to-date returns widened to 8.4 percentage points at the end of August as the Russell 2000 reflected a 2.6% decline for 2008 and the Russell 1000 continued to show a double-digit decline."
Anderson added that the largest stocks in the Russell 1000 are driving the disparity in performance between large caps and small caps, citing the mega-cap Russell Top 50® Index which has reflected a decline of 13.5% year-to-date through the end of August.
The analysis tool at http://www.russell.com/Indexes/performance/real_time_market_analysis.asp showed 71% of the Russell 2000 stocks ended August with a positive monthly return and 51% showed a year-to-date gain for 2008. But a larger percentage of Russell 1000 stocks showed a positive return as 73% ended August with a monthly increase and 54% provided investors with a year-to-date gain.
Value stocks also added to their July gains across the board, outperforming their growth counterparts in August at every market capitalization tier. In the small-cap segment, for example, the Russell 2000® Value Index outperformed the Russell 2000® Growth Index by 2.3 percentage points. The Russell 2000 Value reflected the best return among all of Russell's U.S. indexes for August and ended the month with a year-to-date return very close to positive territory.
Among the different market capitalization tiers measured by Russell's family of U.S. indexes, the micro-cap segment showed the widest year-to-date disparity between growth and value stocks as the Russell Microcap® Growth Index reflected a decline of 11.8% and the Russell Microcap® Value Index showed a 6.4% decline.
"Though year-to-date returns remain in negative territory across the board with several in double digits, every segment of the U.S. equity market gained back some earlier losses," said Anderson.
In the Russell 1000, the top performing stock for August is in the financial services sector (MBIA, 173.5%), but 12 of the top 30 stocks are in the consumer discretionary sector, including Dick's Sporting Goods (30.4%), Polo Ralph Lauren (28.2%), Liz Claiborne (24.5%) and Lowe's (21.3%).
In the Russell 2000, three of the five top-performing stocks for August are financial services firms: Ambac Financial Group (184.7%), Radian Group (120.3%) and FirstFed Financial (96.3%).
| Sector returns for August |
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Russell 1000 |
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Russell 2000 |
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Russell 3000 |
| Autos & Transportation |
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1.3% |
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0.1% |
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1.2% |
| Consumer Discretionary & Services |
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5.1% |
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5.2% |
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5.1% |
| Consumer Staples |
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3.1% |
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4.2% |
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3.1% |
| Financial Services |
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-0.2% |
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4.8% |
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0.3% |
| Health Care |
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1.9% |
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2.9% |
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2.0% |
| Integrated Oils |
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0.5% |
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5.3% |
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0.5% |
| Materials & Processing |
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-2.8% |
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3.3% |
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-2.1% |
| Other Energy |
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-2.2% |
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0.5% |
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-2.0% |
| Producer Durables |
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3.0% |
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2.0% |
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2.9% |
| Technology |
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2.6% |
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4.8% |
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2.8% |
| Utilities |
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1.2% |
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3.1% |
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1.3% |
For more returns data, 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 $211 billion in assets under management as of June 30, 2008, 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 as of June 30, 2008. Founded in 1936, Russell is a subsidiary of The Northwestern Mutual Life Insurance Company.
Contacts:
Steve Claiborne, 253-439-1858
Russell Investments, a Washington, USA corporation, operates through subsidiaries worldwide.
Russell Investments 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.
CORP-5547
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Privacy statement.
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.
Indexes are unmanaged and cannot by invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment.
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