The chart to the right is an update to one we included in a B.I.G. Tips report last Thursday which showed the average percentage decline stocks have seen from their 52-week highs based on market cap and sectors. Through Friday’s close, stocks in the S&P 500 (large cap stocks in the S&P 1500) were down an average of 22.5% from their respective 52-week highs. Mid-cap stocks, which make up the S&P 400 index were down an average of 26.5% from their 52-week highs, and small-cap stocks (S&P 600) were the worst of the bunch with an average decline of more than 30% from their 52-week highs. With everyone focused on the S&P 500’s 10% decline from its intraday high last May, the majority of stocks in America are already in their own bear market.
The chart below breaks down the average percentage decline of stocks in the S&P 1500 by sector. This chart clearly outs the Energy sector as the primary driver of weakness in US equities. Through Friday’s close, the average decline for stocks in that sector has declined more than 50% from its 52-week high. That’s more than cut in half! After Energy, the next weakest sector is Materials, but with the average stock in that sector ‘only’ losing a third of its value, it doesn’t seem that bad relative to Energy. In terms of sectors where stocks have held up the best, at 14.3% and 18.5%, respectively, Utilities and Consumer Staples are the only two sectors where the average stock is not in bear market territory.