Author: Phil Fabrizio, CFA

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March 2026

A few months into 2026, global equity markets are undergoing one of the most significant leadership rotations seen since the early stages of the post-pandemic bull cycle. After several years of dominance by a narrow set of US-based mega-capitalization technology and artificial intelligence (AI) infrastructure players, leadership in 2026 has shifted toward a broader, more cyclical set of sectors. Along with this trend, markets are also experiencing changes in leadership across market capitalizations, styles and geographies. For instance, over the last year markets have seen US small cap stocks outperform large cap stocks, international stocks outperform US stocks, and value stocks outperform growth stocks.

These trends represent reversals of longer-dated performance trends where markets have largely been driven by large, US growth stocks. Given the constantly evolving investment landscape, such trends highlight the importance of diversification for institutional investors.

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