"...Dow Cuts Losses in Half, Small Caps Finish Higher"

From Barron's Stocks to Watch:

Take a look at the where the major index closed today and you’d be pardoned for thinking that it was just another ho-hum day of selling in the market. You’d be wrong.

Sure the S&P 500 finished down 0.8% at 1,862.49 today, while the Dow Jones Industrial Average dropped 173.45 points, or 1.1%, to 16,141.74 and the Nasdaq Composite dipped 0.3% to 4,215.32. But those final numbers leave out some incredibly volatile trading today.

Take the Dow Jones Industrial Average. It dropped 370 points on the open, bounced 262 points by 10:00 a.m., fell 350 points to its low of the day at 15,855.12, before rallying 286 points through the close. Add it up at that’s 1,268 Dow points traversed in one day. (I wish I didn’t have to compute these things manually, because I’d love to compare that to other days with wild swings.)

The big news, though, should be the small-company Russell 2000. Not only was it far less volatile than the its big-cap brethren, it finished up on the day. And not just a little bit up, but up 1% at 1,072.45. For an asset class that was busy getting beaten up as recently as last week, that’s quite a turnaround.

It might also be good news for investors. I spoke with Richard Bernstein of Richard Bernstein Advisors today and he pointed out that the fact that small caps have been outperforming could be a sign that “the healing process has begun.”...MORE

Roger that, healing has begun, over.