More than Brexit Moving Stocks as Russell Rebalances

The Brexit reaction is not the only thing roiling stocks today. The Russell rebalancing is also underway. The entire family of Russell U.S. and Russell Global Indexes are rebalanced each June to reflect market changes in the past year. Approximately $6 trillion in assets benchmarked to and invested in products based on the indexes, according to Russell. Approximately $10 trillion in assets are currently benchmarked to indexes offered by global index provider FTSE Russell, created through the combination of FTSE and Russell indexes last year. The Russell 3000 Index, representing about 98% of the investable US equity market, is comprised of the U.S. large cap Russell 1000 Index, the largest 1,000 US listed stocks by market capitalization, and the U.S. small cap Russell 2000 Index, the next 2,000 largest US listed stocks by market capitalization. This year, there will be 184 additions to and 133 deletions from the broad Russell 3000 Index. The total market capitalization of the constituents of the Russell 3000 Index slipped from $25.3 trillion at last year's reconstitution to $24.1 trillion this year, reflecting smaller U.S. equity markets and a more cautious outlook among US equity market participants. The median market cap for Russell 3000 Index constituents is expected to decrease from $1.6 billion to $1.4 billion this year.