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Small-cap stocks slip below a key level as bond yields rise
The Russell 2000 is on track for its first quarterly loss since early 2025, as investors weigh higher borrowing costs ahead of the Federal Reserve meeting next week.
Investors are watching U.S. small-cap stocks closely as rising global bond yields move the market spotlight back to a segment that has been hit more than the broader S&P 500.
According to FactSet data cited by MarketWatch, small-cap stocks are down in the third quarter through Tuesday and the Russell 2000 is on track for its first quarterly loss since the first three months of 2025.
MarketWatch said small-cap stocks recently slid below a key chart level, with the pressure tied to concerns that higher borrowing costs could weigh on smaller companies.
The outlet also noted that small businesses tend to rely more on debt to fund operations, including variable-rate borrowing, making the group more sensitive to changes in interest rates.
Latest closeS&P 500 7,673.52 ▼0.6%|Russell 2000 2,960.20 ▼0.5%