In last week’s commentary, we discussed that the S&P 500’s 1% gain was masking weakness under the surface as the Russell 2000 was down by 2%. And, these trends got only more extreme as the S&P 500 is down by 2.4%, while the Russell 2000 is down by 5% since last Thursday.
Of course, the bulk of the selling took place today in an abbreviated trading session. The biggest reason was reports of another coronavirus variant, B1.1.529, that is spreading rapidly in South Africa at much faster rates than previous variants. Some cases have been identified in Europe and parts of Asia, and there are doubts about the vaccine’s efficacy against it.