Written by Horizon Investments, LLC.

Equities had a good week last week, shaking off the negativity from the end of the week prior and closing up 2.5% on a global basis (MXWD). Domestic equities led the charge, closing at the highs on Friday, with the S&P 500 up 3.6% (SPX). International developed markets (+0.9% MXEA) and emerging markets (MXEF -0.5%) lagged. Some of this performance disparity is due to timing differences and holidays; ETF index tracker returns were much closer together.

Large-cap tech outperforms
Small caps (Russell 2000) outperformed last week by about 200 basis points, but we’ve seen this price action a few times this year, typically driven by short covering. Zooming out, small caps remain 11% below large caps YTD. Amazingly, large-cap tech has seemed relatively impervious to the ups and downs we’ve seen in other asset classes. In fact, the NASDAQ is up 2.1% on the year [Figure 1].