Small Caps Outshine Major Indexes as Trade-War Anxiety Builds

(Bloomberg) -- Small is the new big in President Donald Trump’s protectionist economy.

For U.S. companies, March has been a great time to be small and focused on the domestic market. Since Trump ratcheted up his protectionist rhetoric on March 1, the Russell 2000 Index has outperformed other major equity benchmarks by at least 4 percentage points.

That disparity came into focus Thursday as the administration prepared to unveil tens of billions of dollars of new tariffs targeting China. The small-cap index fell 1.3 percent, while the Dow Jones Industrial Average, S&P 500 Index and Nasdaq Composite Index each lost at least 1.7 percent.

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