In this quarterly market update, we take a step back and look at what really happened during the second quarter of 2026 and what it means for your financial plan.
We have been partnering with East Bay Investment Services since 2021 to help guide our investment models. Each quarter, they provide a balanced view of the economy, including both opportunities and risks. One consistent theme over the years has been the presence of global conflict as part of the overall investment landscape.
You can watch our podcast episode HERE.
The second quarter of 2026 saw a return to new market highs with global stock market returns bouncing back after a mostly negative first quarter. But it has been a year of contradictions: as markets push to new highs, consumer sentiment has fallen to record lows. And while the focus of market conversation has been around the record size of the SpaceX IPO and the competition among large AI companies, small companies and emerging markets have been the market leaders, each posting returns above 40% for the last twelve months.
Get the full report from East Bay HERE
Summary:
- Stock and bond markets gained ground around the world during Q2.
- Emerging markets and U.S small-cap stocks have led the way this quarter.
- Geopolitical and macroeconomic forces continue to provide uncertainty.
Glass half-full:
- Stocks were up around the world in Q2 and continued to touch new all-time highs.
- Bonds of most credit and maturity types also gained during the quarter.
- Unemployment remains historically low.
- The U.S. economy continues to grow.
Glass half-empty:
- The war in Iran is ongoing.
- Inflation has begun to re-accelerate, and markets now expect the Fed to hike rates rather than cut rates by year’s end.
- U.S. consumer sentiment is near all-time lows.
- Investment markets continue to be volatile around the world.
Click here to get the full, written update, or follow this link for a recording of Eastbay’s video presentation.
Get our Outlook from Quarter 1 2026 HERE.
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