Market Insider

Small-cap shake-up over? Pro says another drop may be looming

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Use strength in small caps to take profits

With small caps higher in four of the last five sessions, market talk has turned to whether they've hit rock bottom—and some strategists say maybe not yet.

Lori Calvasina, Credit Suisse small- and mid-cap strategist, says the Russell 2000 stocks are so overvalued, they could continue to fall.

"The problem is, the valuations are just so bad, even if you had a little relief rally here, I'd still be selling them," she said. Calvasina expects the Russell to end the year at 1,160, but says it could even drop to 1,000 before moving higher.