The percentage of stocks down 20% or more are expanding across all S&P market caps.
Here’s the chart:
Let's break down what the chart shows:
The blue line represents the percentage of S&P 500 stocks (Large Cap) that have declined by 20% or more.
The red line indicates the percentage of S&P 400 stocks (Mid Cap) that have fallen by 20% or more.
The gray line shows the percentage of S&P 600 stocks (Small Cap) that have experienced a decline of 20% or more.
The Takeaway: A decline of 20% or more is typically considered the threshold for defining a "bear market" While this method isn't perfect, it's a nice round number that often brings the price of the stock down to levels that you never thought you would see again.
When we look beneath the surface using a 20% or more decline as our criteria, we can see that these breadth readings are expanding across all market caps.
More than half of the S&P 600 stocks have declined by 20% or more, marking the highest level seen for small-cap stocks since early December 2023.
In the S&P 400, 42% of stocks are down by 20% or more, which is the highest level for mid-cap stocks since early November 2023.
Additionally, nearly one-third of the S&P 500 stocks have fallen by 20% or more, which is the highest level for large-cap stocks since early November 2023.
Do you think the current bull market is coming to an end?
Will we see a drop of 20% or more at an index level?
Grant Hawkridge | Chief Aussie Operator, All Star Charts
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