4,202 U.S. stocks fell as the S&P 500 dropped 0.72%
On Wednesday, September 23, 4,202 of 5,841 U.S. common stocks declined, the S&P 500 fell 0.72%, and the Russell 2000 fund lost 1.82% as the 10-year yield closed at 5.11%.
On Tuesday, 3,081 stocks rose while the S&P 500 finished unchanged. Wednesday, the indexes and the stock-by-stock count both went down. Twelve of the twenty largest U.S. stocks fell, eight rose, and the equal-weight S&P 500 lost as much as the cap-weighted index.
4,202 decliners on the NYSE, Nasdaq and NYSE American
The S&P 500 closed at 7,708.55, down 0.72%.
Chart: Almost three stocks fell for every one that rose
The count leaves out ETFs, funds, foreign listings, and currency and crypto symbols.
Nvidia fell 1.4%, Apple 0.80%, and Amazon 2.2%. Alphabet Class A fell 3.8% as Meta's new Muse AI assistant raised competition. Broadcom, Oracle, JPMorgan Chase, Eli Lilly, Visa, Netflix and Johnson & Johnson also finished lower. Microsoft rose 0.52%, Meta Platforms 1.0%, Tesla 0.32% and Exxon Mobil 1.6%. A 12-8 split among the largest names is mixed. A 4,202-1,444 split across the whole board is not.
Inside the S&P 500 fund SPY, whose 504 holdings cover essentially the whole fund, the book summed to a 0.74 percentage-point decline. Alphabet's two share classes, Nvidia and Amazon subtracted a combined 0.41 percentage points of that. Those four line items are 5.5%, 8.3% and 3.7% of the fund, so they accounted for more than half the cap-weighted decline on a day the rest of the book was falling too.
The Nasdaq Composite fell 1.13%, to 26,936.04, more than the Nasdaq-100's 0.85% drop. Even inside growth stocks, the average name had a worse day than the biggest 100.
The 10-year yield closed at 5.11%
The Wall Street Journal reported that the 10-year Treasury yield reached a 19-year high, trading above 5.1%, as oil jumped back above $100 and stocks fell. On the par curve the 10-year closed at 5.11% and traded as high as 5.135. The two-year finished at 4.85%. Federal Reserve Governor Michael Barr told a Chicago housing summit that further rate increases are likely, a message this newsroom covered while the 10-year was still at 5.06%.
Brent crude jumped 4.5% to $103.76 a barrel and West Texas Intermediate rose 2.7% to $92.99, the oil side of that selloff. The energy sector fund XLE gained 0.99%.
RSP matched SPY. Small caps did not
The equal-weight S&P 500 fund RSP lost 0.70%. SPY lost 0.72%. Two hundredths of a percentage point is not a breadth signal. It is a rounding error that says large-cap stocks, equally weighted or not, fell together.
The Russell 2000 fund IWM lost 1.82%, 1.10 percentage points more than SPY.
IWM fell more than twice the S&P 500
- −1.8%
- −0.8%
- −0.7%
- −0.7%
In IWM, the eight largest single-stock contributions summed to just 0.08 percentage points of the decline.
Equal-weight and small caps had already been sliding for a month while the Nasdaq-100 was still climbing.
That one-month gap between RSP and SPY is 5.2 percentage points. Over five sessions QQQ is still up 5.3% and SPY is up 2.1%; RSP is flat and IWM is down. The concentrated large-cap run of the past week is intact. The average stock never joined it.
On September 18, Nathan Peterson, director of derivatives research at the Schwab Center for Financial Research, wrote that the Russell 2000 had shifted into a downward channel over six weeks, "in part likely driven by the rise in interest rates," and that market breadth had "rolled over" in September. Piper Sandler said in mid-September that groups in defined uptrends had fallen from 53% to 43% and that a sustained rise in the 10-year toward 5.2% would compress equity multiples. Axios argued Wednesday that breadth "isn't that bad," even as worries about the market's underlying strength were popping up again.
Closing the 10.2 percentage point one-month gap between QQQ and IWM would take a retreat in the 10-year from 5.11%, or the average stock joining a Nasdaq-100 that spent the month climbing without it. Wednesday did neither.
Frequently asked
How many U.S. stocks fell on Wednesday?
4,202 of 5,841 U.S. common stocks declined, against 1,444 advancers and 195 unchanged.
Did the biggest stocks drive the S&P 500's decline?
Alphabet's two share classes, Nvidia and Amazon subtracted a combined 0.41 percentage points of the fund's 0.74-point decline, more than half of it, though the rest of the book was falling too.
What happened in the bond and oil markets?
The 10-year Treasury yield closed at 5.11% after trading as high as 5.135, a 19-year high per the Wall Street Journal, while Brent crude jumped 4.5% to $103.76 a barrel.
How far behind are small caps and the average stock?
Over one month IWM is down 5.12% and RSP down 4.43% while QQQ is up 5.05% and SPY up 0.82%.