The Schwab Center for Financial Research (SCFR), which provides top-quality research, timely market insights and practical guidance for investors, today announced the release of its 2026 mid-year outlook, Schwab Market Perspective: Mid-Year Outlook, which delivers insights on the most important market and economic trends that investors should consider for the second half of the year.
The Schwab Market Perspective: Mid-Year Outlook provides perspectives on U.S. stocks and the U.S. economy, taxable fixed income, and global equities.
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“Considering the interplay between economic trends and stock market behavior, the second half of 2026 is presenting investors with a bit of a split verdict. The earnings backdrop is the strongest it has been in years and although it is concentrated, it is not a mirage. The economy and labor market have remained resilient. However, the index-level signal from the stock market is obscuring a more complicated picture: concentrated earnings growth, record household equity exposure, consumer sentiment at historical lows for everyone outside the stock market, and a bond market that’s increasingly competitive with equities on a risk-adjusted basis.”
Liz Ann Sonders, Chief Investment Strategist, and Kevin Gordon, Head of Macro Research and Strategy, Schwab Center for Financial Research |
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“Our broad message for the second half of 2026 is this: Income still matters, but investors should be selective. Despite the recent rise in Treasury yields, we suggest investors favor a below-benchmark average duration with their bond holdings, favoring short- and intermediate-term maturities. In our view, now is not the time to favor long-duration investments just yet.”
Collin Martin, Head of Fixed Income Research and Strategy, Schwab Center for Financial Research |
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“In 2026, economic activity has improved. Earnings growth continues to be strong. Capital investment remains robust. Financial conditions are relatively benign. But those strengths are concentrated, and they exist within a shifting structural regime that could produce ongoing geopolitical pressures and increased inflation risks over the longer term.”
Chris Ferrarone, Head of Equity Research and Strategy, and Michelle Gibley, Director of International Equity Research and Strategy, Schwab Center for Financial Research |
Learn more about the Schwab Market Perspective: Mid-Year Outlook here.
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Disclosures:
This material is intended for general informational and educational purposes only. This should not be considered an individualized recommendation or personalized investment advice. Where specific advice is necessary or appropriate, individuals should contact their own professional tax and investment advisors or other professionals (CPA, Financial Planner, Investment Manager, Estate Attorney) to help answer questions about specific situations or needs prior to taking any action based upon this information. The securities and investment strategies mentioned are not suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decisions.
Past performance is no guarantee of future results.
The value of investments and the income derived from them can go down as well as up. Future returns and the achievement of stated goals are not guaranteed, and a loss of principal may occur.
Investing involves risk, including loss of principal.
International investments involve additional risks, which include differences in financial accounting standards, currency fluctuations, geopolitical risk, foreign taxes and regulations, and the potential for illiquid markets. Investing in emerging markets may accentuate this risk.
Fixed income securities are subject to increased loss of principal during periods of rising interest rates. Fixed income investments are subject to various other risks including changes in credit quality, market valuations, liquidity, prepayments, early redemption, corporate events, tax ramifications, and other factors. Lower rated securities are subject to greater credit risk, default risk, and liquidity risk.
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