WS #14731
Capital is rapidly exiting smaller and cyclical companies, with the Russell 2000 ETF (IWM) recording $3.3 billion in weekly outflows, marking its second-largest withdrawal of the year. This flight to quality is accompanied by a 10% drawdown in the Industrial Select Sector SPDR Fund (XLI), reflecting investor anxiety over the combined impact of high interest rates on small-cap borrowing and rising energy costs on industrial operations.
Small Cap and Industrial Outflows
Capital is rapidly exiting smaller and cyclical companies, with the Russell 2000 ETF (IWM) recording $3.3 billion in weekly outflows, marking its second-largest withdrawal of the year. This flight to quality is accompanied by a 10% drawdown in the Industrial Select Sector SPDR Fund (XLI), reflecting investor anxiety over the combined impact of high interest rates on small-cap borrowing and rising energy costs on industrial operations.