Small-Cap Resurgence in 2026

• The Russell 2000 is now outperforming the S&P 500 and Nasdaq 100 in all timeframes from year-to-date through 12-month periods, marking a significant reversal after years of underperformance
• MoneyFlows data shows strong investor appetite for smaller market-cap companies in 2026, with sector leadership rotating from technology and communications into energy, materials, and industrials
• Featured small-cap stocks receiving Big Money inflows include ACM Research ($3.4B market cap, 44.5% three-year sales growth), Fox Corporation ($32.1B), New York Times ($11.6B), and Rambus ($13.4B)

Market Summary: Small-Cap Resurgence in 2026

Key Market Shift

A significant rotation is underway in equity markets, with small-cap stocks outperforming major indices across all timeframes in the past year. The Russell 2000 is now beating both the S&P 500 and Nasdaq 100, marking a reversal after years of underperformance.

Driving Factors

The small-cap rally stems from an improving business environment driven by Federal Reserve interest rate cuts, a strengthening economy, and increased corporate investment. This has triggered a "risk-on" sentiment favoring smaller companies over previously dominant mega-cap technology stocks.

Sector Leadership Changes

Market leadership has shifted dramatically from 2025. Technology and communications sectors have declined, while energy, materials, and industrials are surging. MoneyFlows data reveals particularly strong demand for small-cap technology and consumer discretionary stocks.

Featured Companies

ACM Research (ACMR): $3.4B market cap semiconductor equipment manufacturer showing 44.5% three-year sales growth and 41.6% earnings growth, attracting significant institutional buying.

Fox Corporation (FOXA): $32.1B media company with 16.6% one-year sales growth, experiencing Big Money inflows.

New York Times (NYT): $11.6B organization posting 13.9% three-year EPS growth and 7.6% sales growth with an 11.4% profit margin.

Rambus Inc. (RMBS): $13.4B semiconductor/memory applications company with 20.2% three-year sales growth, minimal debt, and projected 19.2% EPS growth.

Market Implications

The data suggests investors are rotating from 2025's mega-cap leaders into smaller, higher-growth opportunities, signaling increased risk appetite and confidence in broader economic expansion beyond traditional market favorites.