Mar. 20 at 7:33 PM
The Russell 2000 has dropped more than 10% from its recent high, making it the first major U.S. benchmark to enter correction territory in 2026. A correction is defined as a decline of between 10% and 20% from a recent peak.
Small-cap stocks had started the year strong, with the Russell 2000 up around 1% in 2026, boosted by hopes for easier monetary policy and a pivot away from large-cap equities. However, the index has fallen over 6% this month amid rising geopolitical tensions, including the ongoing conflict in Iran, which has driven Brent crude prices up more than 50%. Small caps are particularly sensitive to oil price swings and economic cycle slowdowns due to their heavier exposure to cyclical sectors.
Other major U.S. benchmarks are approaching correction territory as well: the Dow Jones Industrial Average and Nasdaq Composite are more than 9% off their all-time highs, while the S&P 500 has declined over 6%.
$RUT $SPX $LCO