Listen and subscribe to Stocks In Translation on Apple Podcasts, Spotify, or wherever you find your favorite podcast. Small-cap stocks might be the next big thing. In this episode of Stocks in Translation, Prairie Operating Co Marketing Strategy executive vice president and TheBigSkinny.com founder Lou Basenese joins host Jared Blikre and Senior Reporter Allie Canal to discuss high-performance computing and how it is the newest market commodity. Basenese breaks down both the opportunities and challenges fac ...

Market Performance - Small-cap stocks outperformed major U.S. stock market indices on August 12, with the Russell 2000 Index gaining nearly 3%, marking its largest one-day rally since May [1] - The iShares Russell 2000 ETF (IWM) also saw a jump of about 3% [1] Inflation and Economic Indicators - The Consumer Price Index rose 2.7% year over year in July, slightly below the forecast of 2.8%, while core inflation increased to 3.1% from June's 2.9% [3] - The softer inflation data has strengthened the case for potential Fed rate cuts in September, with futures markets pricing in a 94% chance of a quarter-point cut [3] Small Business Sentiment - Optimism among small business owners increased in July, with the small business optimism index climbing to 100.3, the highest level since February and above the 52-year average of 98 [5] - This rise in optimism may indicate a stabilizing business environment, positively impacting small-cap stocks and ETFs [5] ETF Performance - Invesco S&P SmallCap Industrials ETF (PSCI) rose 3.8%, focusing on 93 small-cap companies in industrial sectors [6] - Invesco S&P SmallCap Information Technology ETF (PSCT) increased by 3.7%, providing exposure to 69 small-cap tech companies [7] - Invesco S&P SmallCap Value with Momentum ETF (XSVM) gained 3.6%, tracking 122 stocks with high value and momentum scores [8] - Invesco S&P SmallCap Quality ETF (XSHQ) also rose 3.6%, holding 121 stocks with high quality scores [9][10] - First Trust Small Cap Value AlphaDEX Fund (FYT) increased by 3.5%, tracking 262 stocks from the Nasdaq US 700 Small Cap Value Index [11] Sector Trends - Financials, industrials, and consumer discretionary stocks, which make up over half of the Russell 2000, are experiencing strong rebounds [13] - Regional banks are stabilizing as credit risks recede, while manufacturing and transportation sectors benefit from improved supply chains and infrastructure spending [13] M&A Activity - There is an uptick in dealmaking within healthcare, biotech, and tech services, with large-cap companies targeting small and mid-sized firms for growth [14] - This M&A momentum is attracting active managers and hedge funds, injecting fresh liquidity into the small-cap space [14] Valuation Trends - Large-cap valuations have become stretched after a prolonged rally, while small-caps remain relatively discounted, prompting institutional investors to rotate into under-owned segments like small-caps [12]