(Bloomberg) — Stocks hit all-time highs as bets the Federal Reserve will soon start cutting rates fueled a rush into riskier corners of the market.
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Wall Street extended a pattern of money rotating into small caps and out of the megacap “safety” since last week’s soft inflation data. Over the past four sessions, the Russell 2000 has beaten the Nasdaq 100 by almost 11 percentage points — a feat not seen since 2011. An equal-weighted version of the S&P 500 — where the likes of Nvidia Corp. carry the same heft as Dollar Tree Inc. — outpaced the US equity benchmark. That index is less sensitive to gains from the biggest companies — providing a glimpse of hope the rally will broaden out.
“Rotation is the name of the game,” said Andrew Brenner at NatAlliance Securities. “This is consistent with the increased perception of cutting rates.”
Brenner highlighted the fact that around 4 a.m. New York…
