2Q26 Market Insights | Beyond the Numbers
Markets rose despite mixed economic signals. Stocks posted gains in Q2, with stocks climbing on the back of strong corporate earnings, resilient consumer spending, and ongoing enthusiasm around AI-related investments.
Author
Chris McCall
- Markets were resilient amid continued uncertainty. The first half of the year reminded investors that markets rarely move in a straight line. Periods of volatility driven by the ongoing conflict in Iran and persistent inflation concerns ultimately gave way to solid gains. Investors looked beyond short-term headlines and focused on the strength of corporate earnings and the broader economy.
- Market leadership broadened beyond mega-cap technology. While artificial intelligence remained a key investment theme, gains became more widespread across the market. Small- and mid-sized companies, which had lagged for several years, outperformed large-cap stocks during the first half, highlighting how quickly market leadership can evolve and reinforcing the value of maintaining broad diversification.
- Higher interest rates remain part of the investment landscape. Inflation proved more persistent than many expected, leading investors to push back expectations for Federal Reserve rate cuts. While this created pressure on bond prices, today's higher yields continue to offer more attractive income opportunities than investors have seen for much of the past decade.
- Research Highlight: The benefits of AI may continue to broaden. The first phase of the AI boom largely rewarded the companies building the technology and infrastructure behind it. The next phase may increasingly reward the businesses that successfully use AI to improve productivity, reduce costs, and make better decisions. After 30 years of digitizing information, we may now be entering an era focused on making the physical economy smarter. As adoption expands across industries, more companies may benefit from AI, creating investment opportunities well beyond those that led the initial buildout.
2026 Market Performance (Through 6/30/2026)
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