2026 Midyear Update: Strong Start, What Comes Next

As we celebrate America's 250th birthday this year, we are grateful for the freedoms we enjoy this Fourth of July. We extend our thanks to the servicemen and women, past and present, whose service and sacrifice have made these 250 years possible.
 
We are pleased to report that your portfolios continue to do well as we reach the halfway mark of the year. So far, markets have followed a typical, though more volatile, midterm election-year cycle characterized by a strong start, a spring pullback, and a summer rally. Going forward, we expect this pattern to continue: a bumpy but positive summer, a pullback into the election this fall, followed by a strong year-end rally. Currently, we are seeing a broadening market, with rotation into financials, healthcare, and industrials.
 
In the bond markets, we saw interest rates spike driven by the Iran conflict and the spike in oil prices. Recently, energy prices have fallen significantly, easing pressure on inflation and the bond market. Over the past several weeks, we have seen bond market volatility moderate while interest rate-sensitive industries have improved. This could be a signal that the markets are sniffing out a potential downward shift in interest rates. If so, this would be positive for the economy and markets in general. This is something we are watching very closely.
 
Overall, we expect the summer to stay a bit choppy but generally trend higher, with another likely pullback as we approach the fall election before a strong finish to the year. Interest rates look to have stabilized and could moderate later in the year. We remain positive in 2026, with an even better 2027 in store.
 
For the full rundown, please take a few minutes to watch this Mid-Year Market Update Video. As always, reach out to your Riggs team with any questions.
 
Wishing you and your family a happy Fourth of July. 

Warm regards,
 
The Riggs Team
Riggs Asset Management Company