The second quarter of 2026 was a reminder of just how quickly markets can move beyond alarming headlines. Following a sharp market decline in March amid the conflict involving Iran and concerns surrounding global energy supply, many equity markets pushed to new highs by quarter-end.

As always, we maintained our discipline throughout the volatility and allowed market fundamentals, rather than headlines, to guide long-term investment decisions.

With that, we are happy to share with you our 2026 Q2 Market Review.

MARKET SUMMARY

U.S. Stocks – a strong rebound, ending the first half positive

• US stocks delivered a strong rebound during the quarter, gaining approximately 15% to end the first half up about 10%.  Despite no shortage of competing narratives — artificial intelligence, interest rates, inflation, and valuation concerns among them — investors remain broadly optimistic, and corporate earnings continue to be strong.

Smaller companies led the way

• Small-cap stocks were a standout, with the Russell 2000 Index gaining roughly 22% for the quarter. Large-cap growth and technology stocks also staged a sharp recovery from their Q1 decline, finishing Q2 at record levels as well.

International stocks – one of the quarter’s strongest performers

• Developed international markets returned just over 10% for the quarter, while emerging markets surged more than 24%, making them one of the strongest-performing asset classes globally. After years of lagging U.S. markets, the past 18 months have been a useful reminder that the U.S. stock market is not the only game in town.

Bonds – modest gains, with a silver lining for savers

• Fixed income markets posted modest positive returns. The yield on the 10-year U.S. Treasury rose to roughly 4.4%, creating modest headwinds for bond prices. On the brighter side, shorter-term yields above 4% now allow savers to earn a positive real return, that is, a return above inflation, without taking significant risk. This is a meaningful change from the near zero-interest-rate years of the 2010s, when shorter-term cash equivalents often failed to keep pace with inflation.

Energy – volatility in both directions

• Oil prices, which surged in Q1 amid conflict in the Middle East and concerns over Strait of Hormuz shipping lanes, retreated meaningfully as geopolitical tensions eased.  This story is likely to play out over the coming months or years ahead.

While market movements and geopolitical developments naturally attract attention, our focus remains on the factors we can control: maintaining appropriate diversification, managing risk, and aligning portfolios with your long-term goals. The second quarter provided another valuable reminder that markets often recover long before uncertainty disappears from the headlines.

Thank you for your continued trust and confidence. If your goals, circumstances, or priorities have changed—or if you simply want to revisit your plan— we encourage you to reach out.