S&P 500 Equal-Weight Index Heads for Seventh Straight Weekly Drop, First Since 2002 and 2022 Bear Markets
Summary
- A seventh straight weekly decline in the S&P 500 Equal-Weight Index would mark a pattern seen only twice before, during the bear markets of 2002 and 2022.
- The market-cap-weighted S&P 500 Index has remained relatively steady, with large technology stocks supporting the benchmark.
- Weakness in the Equal-Weight Index signals continued struggles across many stocks outside large technology stocks, while the gap between the S&P 500's stability and volatility in individual names has widened to its largest level since the dot-com bubble burst in 2000.
The S&P 500 Equal-Weight Index is on track for a seventh straight weekly decline, a stretch seen only twice before during the bear markets of 2002 and 2022.
Walter Bloomberg reported on October 30 that if the equal-weight index ends lower this week, it will mark seven consecutive weeks of losses. By contrast, the market-cap-weighted S&P 500 has remained relatively steady as large technology stocks continue to support the benchmark.
The equal-weight index gives each S&P 500 component the same weighting, making it a gauge of market breadth and the broader performance of individual stocks.
Weakness in the equal-weight index signals that many stocks outside the large technology names continue to struggle.
The gap between the S&P 500's stability and volatility in individual stocks has widened to its largest level since the dot-com bubble burst in 2000.
JH Kim
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