Below is a chart that shows the average year-to-date percentage change of stocks by sector in the Russell 3,000 (blue shading), and the year-to-date percentage change of the ten market-cap weighted S&P 500 sectors (orange shading). The Russell 3,000 includes stocks that make up 98% of all U.S. equity market cap, so it contains the largest companies in the U.S. on down to the very smallest. The S&P 500 is an index consisting of 500 of the very largest companies in the U.S.
So far this year, the average stock in the Russell 3,000 is down 2%, but the S&P 500 large-cap index is up 1.2%. This data point right away shows that large-caps are outperforming small-caps in 2015. Looking at sector performance, some very interesting divergences have taken place this year. For Health Care, the average stock in the Russell 3,000 is up 9.7% YTD, but the S&P 500 Health Care sector is up just 5.1%. This is one of the few sectors where the smaller stocks have done better than the larger ones.
The reverse is true in a big way for the Consumer Discretionary sector. As shown in the chart, the average Consumer Discretionary stock in the Russell 3,000 is down 6.4% year-to-date, but the S&P 500 Consumer Discretionary sector is up 11%. That 11% gain makes Consumer Discretionary the best performing sector in the S&P 500 this year. Clearly the bulk of Consumer Discretionary stocks are not having a good year, but because the largest ones — and more specifically — THE largest one — have done well, the sector’s year-to-date performance at least in the S&P 500 is very strong. The one stock we’re referring to is Amazon.com (AMZN), which is up 114% so far this year.
For those interested, below is an updated list of the best performing stocks in the U.S. so far this year with less than a month and a half to go. The bulk of stocks on this list are biotech names. In fact, 23 of the top 40 are biotech related. The top performer is currently Eagle Pharma (EGRX) with a gain of 438%. Exelixis (EXEL) ranks second with a gain of 302.8%, followed by Natural Health Trends (NHTC) at 271%. A few of the notable non-biotech stocks on the list of 2015’s biggest winners include Netflix (NFLX), LendingTree (TREE), Dycom (DY) and Amazon.com (AMZN).