Winners Taking Everything in Relentless Five-Week Nasdaq Surge
- Covid has boosted large companies while hurting small business
- Russell 2000 lags Nasdaq 100 by 7 percentage points in 2 weeks
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For a clear lens into how investors see the Covid crisis reordering the economy, consider how they are dividing the stock market’s bounty during what is fast becoming the rally’s most powerful stretch.
A five-month surge in the Nasdaq 100 just pushed one valuation measure -- the index’s price relative to the combined sales of its companies -- above 5 times, a level comparable to the dot-com bubble. On the other end of the luck spectrum are small caps, where pessimism about a broad-based economic rebound has held the ratio to 1/5th that, one of the widest gaps ever.