NEW YORK -- The Russell 2000 Index climbed to an all-time high Friday, and the Nasdaq composite index reached a level unseen since 2000 as an equities rally that started last week continued through one of the slowest trading days of the year.
The Russell 2000 of small-cap companies gained 0.7 percent to a record 1,215.19 at 4 p.m. in New York. The Nasdaq composite jumped 0.7 percent to the highest level since March 2000, as biotechnology companies rebounded a second day. The Standard & Poor's 500 index rose 0.3 percent to 2,088.78. The Dow Jones industrial average added 23.76 points, or 0.1 percent, to 18,053.97. Trading in S&P 500 companies was 52 percent below the 30-day average for this time of the day.
U.S. markets were closed Thursday for Christmas. Most major markets around the globe are shut Friday.
"We've had quite a run here," Eric Cinnamond, who manages the $691 million Aston/River Road Independent Value Fund, said by phone from Louisville, Ky. "The consensus has been that the domestic economy is improving and small-caps are more exposed to that than large-cap multinational companies. Managers are making sure they're owning what's working and the herd mentality is at extremes right now."
The Russell 2000 and Nasdaq composite have shown resilience this year. The Russell recovered from a correction that saw it slip 11 percent over a five-week period starting in early September. The index has surged 16 percent since reaching a one- year low on Oct. 13.
The Nasdaq composite closed below 4,000 twice this year, on Feb. 3 and April 11. It has rallied 20 percent to the highest since March 29, 2000. The gauge is now about 5 percent below its all-time closing high of 5,048.62, set on March 10, 2000. The Nasdaq 100 Index, which jumped 0.9 percent Friday, is about 20 points away from reaching a 14-year high.
Even with its 4.4 percent gain in 2014, the Russell still trails the S&P 500 and Dow, growing at less than half the pace.
The S&P 500 and the Dow are at records this week after posting their biggest rally in three years. The recent gains are taking the Dow up 1.3 percent for the month and 9 percent this year. The gauge has advanced for seven straight days, the longest streak since March 2013. The S&P 500 has risen 1.1 percent in December and 13 percent for the year.
"Momentum has been building in the last month for small-cap names," Michael James, a Los Angeles-based managing director of equity trading at Wedbush Securities, said by phone. 'It's merely playing catch up. Given that the Russell has lagged through this year, people are trying to find beta for performance."