Small stocks are about to take over? Wall Street has heard that before.

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NEW YORK (AP) — Suddenly, smaller stocks seem to be making bigger noise on Wall Street. After getting trounced by their larger rivals for years, some of

Trader Gregory Rowe works on the floor of the New York Stock Exchange, Monday, July 22, 2024. After getting trounced by their larger rivals for years, some of the smallest stocks on Wall Street have shown much more life recently. After getting trounced by their larger rivals for years, some of the smallest stocks on Wall Street have shown much more life recently. Hopes for coming cuts to interest rates have pushed investors to look at smaller stocks through a different lens.

They were all encouraging signals to analysts, who say a market with many stocks rising is healthier than one dependent on just a handful of stars. Traders are also thinking cuts to interest rates are much more imminent than before, with expectations recently running at 95% confidence that the Fed will make a move as soon as September, according to data from CME Group“Fade the chase in small caps, which is likely unsustainable,” according to Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management.

 

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