Gap Between S&P 500's Biggest Winner and Loser Hits Low for Year

(Bloomberg) -- The distance between the S&P 500 Index’s biggest winner and biggest loser on Friday was its narrowest level of the year, at just 6.75 percentage points. That capped a wild week that included both the steepest drop ever on a Christmas Eve and then a 5 percent rebound on Boxing Day, the biggest one-day surge in almost a decade.

General Electric Co. led the index with a 3.3 percent gain on Friday, while Cabot Oil & Gas Corp.’s 3.45 percent loss was the biggest drop.

Friday’s finish wasn’t an aberration. Previously the tightest close, and the only other time the gap was less than 7 percentage points, was Thursday’s 6.82 percentage point difference.

The lack of differentiation between the leader of the pack and the laggard might add credence to a theory by Wells Fargo strategist Pravit Chintawongvanich that pension fund rebalancing drove this week’s market frenzy.

Institutional investors with large holdings in stocks and bonds use the end-of-quarter period to balance holdings, adding to losers and cutting down winners. This time, they went big on U.S. large and small caps, adding $35 billion and $21 billion to indexes that are set to post the worst month since 2009. Money got pulled from fixed income that’s outperformed stocks, he said.

--With assistance from Jeremy Herron, Vildana Hajric and Elena Popina.

To contact the reporter on this story: Brandon Kochkodin in New York at bkochkodin@bloomberg.net

To contact the editors responsible for this story: James Ludden at jludden@bloomberg.net, Virginia Van Natta, Ros Krasny

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