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Markets: Russell 2000 breaks out, chip sector climbs in 2024

The Russell 2000 (^RUT) has been trading at a generally flat range for the past 2 years, but the small-cap index has started to consolidate and begin to break out from its pattern over the past few months.

The chip sector continues to see massive gains as stocks like Nvidia (NVDA) and Super Micro Computer (SMCI) climb higher year-to-date.

Yahoo Finance reporter Jared Blikre joins the Live show to break down all the latest trends and movements in the stock market and put all the important numbers into context.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

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Editor's note: This article was written by Nicholas Jacobino

Video transcript

SEANA SMITH: And we are more than just about an hour, an hour and 15 minutes into the trading day. We got to get back to the markets here. The S&P hovering right around that 5,000 level, just above that level here. That's so critical here. We'll see whether or not we are able to close above that milestone.

For a closer look at some of the trends that we're seeing, Jared Blikre is standing by at the big board for us. Jared?

JARED BLIKRE: That's right, Seana. We'll see if we can get that close. In the meantime, tech is leading in the Dow. That's in negative territory. But the NASDAQ composite up 86 basis points, the Russell 2000 up a little bit less than that.

And I want to focus on the Russell 2000 for a minute. This is a three-year chart. And you can see over the last two years, roughly, been trading in a very flat range, very sideways. And it's frustrated a lot of traders. Over the last three months, though, we have been consolidating in this pennant formation. And we are just now breaking to the upside.

If we close there, that will be a mild breakout. The reason I mention this, we've had some of the smaller indexes like the Russell 2000, also the transports not confirming the very bullish action that we're seeing in other markets, including tech, including the Dow industrials themselves.

But the Dow transports here trying to break through that three-month high. I'll put you-- show you a three-year chart. You can see we've had higher highs in there. But for the most part, this is a very sideways market as well.

Well, let me show you a market that is not going sideways. This is the NASDAQ 100. Put a line chart on here. Only yesterday did we break to the upside for the first time. Now, this is a NASDAQ 100 equal weighted. If you're looking at the NASDAQ regular weighted, that would be market cap weighted, where you have all the big names like Apple, weighted more according to their size.

You can see this broke to the upside quite strongly. And that was late last year. But then you go down the tech sector. You take a look at the Fang index. This is largely correlated to the Mag Seven. This is even more bullish than the NASDAQ 100.

And then you take a look at the semiconductors. That's a similar situation as well. And I've been tracking the semiconductors. It's not just NVIDIA. It's a whole slew of them. By the way, this is a sector action that's tech and the number one spot, followed by consumer discretionary.

But let's stick with the semiconductors here. NVIDIA at another record high. That's probably going to happen most days. At least, it has happened most days that I've seen.

The Taiwan Semi here, this is an interesting stock. It's down a little bit today. But here it is on a three-year basis. And it is right up against these highs that we've seen. Here's a five-year. And you can see it's threatening to take out this top right here.

This was a pretty big M top. But this is thoroughly completed that pattern. And now, we are in an upward trend with higher highs and higher lows. We have approached these levels very quickly. So I do expect a little bit of a pause before being able to break through, if that happens. But nevertheless, looking pretty bullish there.

And I was also taking a look at ASML. This is a stock that just recently broke to its own new record highs. And just looking at the techs semiconductor space, overall, in the year, let me pull up the year-to-date figures for you.

And you can see NVIDIA, number two next to Super Micro Computer. That's up 161%. But look at Taiwan Semi, ASML, each up more than 24% more than AMD. So the chip sector all around is just on fire, guys.

SEANA SMITH: It certainly has had a tremendous start to this year. Jared, thanks so much for bringing that down for us.