Another week of modest gains has investors moving back into stocks, and the major indices are around breakeven for the year. Over the last week small cap energy added almost 10% and all other sectors, save healthcare, jumped between 1% and 4%. The market feels much more stable and while I don't advise jumping back in with both feet, I continue to think incremental buying in the stocks you want to hold for the long-term is a good move.
Small caps are still trailing their larger companions in many sectors, but the gap is closing fast. The one big area we haven't seen any improvement in is biotech (both large and small caps). I think if this market is really going to rise, we'll need to get some participation there. But I'm not holding my breath--I don't think investors risk appetite is quite ravenous enough to feast on biotech bargains just yet.