Big Caps finally have the upper hand

We have the most significant evidence yet of a lag in small and madcap stocks vis-à-vis their big cap brethren. The big cap S&P 500 and the Dow are near their highs for the year. Even the Nasdaq Comp and 100, whose charts are laggards in comparison, showed impressive buying when the market made a smart advance two weeks back, taking out their August highs. But the S&P 400 and 600 did not take out their August highs and are miles from their all time highs in May, a marked change in character from the way these indices acted off the bear market bottom in 2002. It clearly seems time to move into larger capitalization names.