Growth-stock strength shifts into smaller U.S. companies

Renewed demand for U.S. growth stocks has done more for shares of smaller companies than their larger peers. The ratio between the Russell 2000 growth and value indexes rose Friday to its highest level since February 2001, while a similar gauge that’s based on the S&P 500 Index failed to surpass an 18-year peak reached on Sept. 28. The Russell 2000 ratio climbed 7.9 percent from its most recent low, on Nov. 19, through Friday. During the same period, the S&P 500’s growth and value indicator only added 5.4 percent.

Go large for U.S. stock leaders, OppeheimerFunds says

Larger U.S. companies are poised to extend years of gains relative to smaller peers, according to Talley Leger, an equity strategist at OppenheimerFunds. He cited the ratio between the S&P 500 and Russell 2000 indexes, which rebounded 13 percent through Friday from an almost three-decade low in March 2014, in a report last week. “The current wave of large-cap outperformance” may last at least two more years, Leger wrote, if history is any indication. Relatively slow economic growth, a weaker dollar and a brighter earnings outlook are among reasons to favor large caps now, in his view.