Global Stocks Rally in Q2; Tech and Industrials Lead

Global equities rebounded in the second quarter of 2026, with the reporting period ending June 30. U.S. Technology and Industrials recorded the largest sector gains, while Energy and Utilities produced the weakest returns.

Technology outperformed after recovering from losses in the prior quarter. Corporate earnings tied to artificial intelligence spending and productivity improvements supported gains in Technology. Industrials advanced alongside Technology, reflecting similar investment and efficiency trends. Energy underperformed as oil prices fell from a first-quarter peak above $100 per barrel. Utilities finished the quarter in negative territory; rising interest rates reduced the appeal of income-like utility stocks and contributed to the sector’s relative weakness.

Emerging markets led global regional returns. South Korea and Taiwan delivered quarterly gains above 50 percent, offsetting a second consecutive quarterly decline in China and muted returns across Latin America. Currency movements influenced results: the U.S. dollar strengthened, while the yen and Canadian dollar were among the weakest major currencies during the quarter. For U.S.-based investors, a stronger dollar reduced dollar-denominated returns on foreign holdings; in some exporting economies, weaker local currencies supported exporters’ competitiveness.

Portfolio managers identified corporate earnings as a primary factor allowing equities to rise amid softer macro data. Measures of technical and fundamental momentum were broadly positive. Shorter-horizon teams reported closer monitoring of tactical indicators given elevated investor sentiment and an expectation that the Federal Reserve will likely keep policy on hold.

Market volatility persisted during the quarter. Rising interest rates continued to pressure fixed-income values. Currency swings, regional political risks and concentrated gains in a few markets created potential for rapid divergence in returns. Analysts recommended that assessments of portfolio allocations take into account earnings trends, currency exposure and sensitivity to interest-rate changes.