What global stock market dynamics portend for 2026

Even though the year has not yet ended, some clear but peculiar patterns have emerged from stock-market returns.

- NARAYAN RAMACHANDRAN

Here are the facts for the US stock market this year. With all indices hitting respective highs, the Nasdaq Composite (up 22.5%) has so far beaten the S&P 500 (18.5%) and Dow Jones 30 (13.0%). Within the Nasdaq index, some sub-sectors of technology did very well indeed (hardware and AI), while others did poorly (consumer technology and SaaS companies). The divergence is best illustrated by Nvidia and Alphabet (Google), which represent the AI boom, delivering year-to-date (YTD) returns of 38% and 62% respectively, versus Amazon and Netflix, which represent the consumer-tech segment, delivering only 4% and 9%. Just 14 stocks make up 75% of the Nasdaq 100, ten of which delivered returns of more than 15% over the year, with Palantir leading the pack with its 40% YTD return. Only four stocks—Meta, Netflix, Amazon and Costco—underperformed.

Dig a little deeper and the stocks that did exceedingly well outside the tech sector appeared to be related to the AI boom. For instance, the best performing non-tech stock on the S&P 500 is GE Vernova, with a 130% YTD return that was driven by strong demand for energy from AI data centres. There are two other main themes. Commodity stocks, particularly of gold-related companies like Newmont Mining (up 48%), did very well with gold hitting its peak price of $4,380 per ounce. Defence stocks, particularly aerospace companies like GE Aerospace (81%), also performed well.