Small-cap stocks surged in H1 2026, marking the Russell 2000’s strongest first-half return since 1991.
The Russell 2000 Index rose over 20% in the first half of 2026, its best performance for the period since 1991. The gain marks only the fifth time since 1980 the index has climbed more than 20% in the first six months of a year.
The S&P 500 also advanced, posting a 9.6% return through June. Historically, years with similar first-half gains for the Russell 2000 have seen mixed second-half results, including a 26.9% decline in 1987 after a strong start.
When the Russell 2000 has outperformed the S&P 500 in the first half, the third quarter has often been weaker for large caps, with the S&P 500 averaging a 1.5% loss.