What's Ahead in the Second Half for Markets? Pt. II

Editor’s note: We asked a group of leading Pittsburgh-area wealth managers to give their answers to this question: “So far, 2026 has been treacherous for investors. What do you expect for the second half and where do you see opportunity?”

Previously in this series: What’s Ahead in the Second Half for Markets?

ERIC BOUGHNER, BNY WEALTH While global events are creating uncertainty, the impact from volatile oil prices looks manageable and the overall outlook is starting to improve, even if markets still may be bumpy along the way. We expect some ups and downs in the near term, but the economy remains on solid footing. Growth is continuing, the job market is holding up well, and company earnings are helping support stocks. Looking ahead to the second half of the year, we see more reasons for optimism. In this environment, staying disciplined and well-diversified remains one of the best ways for investors to participate in potential gains while managing risk.

JOHN NICHOLS, BILL FEW ASSOCIATES Market performance in the second half of 2026 will be heavily influenced by the current conflict with Iran and oil prices. If the conflict is resolved soon, markets could recover their year-to-date losses and grow beyond previous market highs. However, if it becomes protracted, market volatility could last throughout 2026. Diversified portfolios of stocks and bonds experienced above-average growth from 2023 through the beginning of this year. The recent market pullback provides a good opportunity to review your portfolio allocation with your advisor to ensure it aligns with your risk tolerance and can weather whatever the second half brings.

DAMIAN MCINTYRE, FEDERATED HERMES Investor outlook in 2026 has been shaken repeatedly by conflicts and war in the Middle East, visible stresses in private credit and the AI disruption in software. With Iran, an end to the conflict is in the economic and political interests of both that country and the United States. Prolonged conflicts in the Middle East risk higher gasoline prices and a deeper equity drawdown. While the news may appear grim at times, we recommend that investors stay disciplined and wait out any storms. Market pullbacks should present opportunities to add risk selectively. This underpins our year-end S&P 500 target of 7,500.

TIMOTHY D. RICE, SMITHFIELD TRUST COMPANY Claims about which stock, asset class or sector will lead markets higher in the second half of 2026 are, at best, “educated guesses.” The more reliable opportunity lies in the one constant across markets: irrational behavior driven by human emotion. As Sir John Templeton warned, the belief that “this time it’s different” appears every cycle, yet human emotion never changes. Fear and exuberance have driven and will continue to drive mispricing across markets. Maintaining discipline (and dry powder) will allow investors to capitalize on the impatience of others, which is where durable outperformance is consistently generated.

JOSEPH A. SCARPO, CAPTRUST On April 14, the market, as measured by the S&P 500 Index, was positive for 2026 — showing how quickly market conditions can change. Periodic declines are normal and a healthy characteristic of long-term market progress. Our second-half outlook is consistent with our approach to investing: own a diversified group of companies aligned with one’s overall investment plan and rebalance allocations to keep that plan on track. We believe an allocation to fixed income sufficient to cover one’s needs over a 10-year period provides adequate protection for investors to weather short-term market events and take advantage of stock market opportunities as they arise.

KIMBERLY CAUGHEY FORREST, BOKEH CAPITAL PARTNERS 2026 has brought stormy waters to some investors, but not to us. Volatility reflects investors’ worry, but other market forces allowed outperformance. No one honestly knows what the second half of 2026 will bring but select AI companies in our portfolio continue to outperform the S&P 500. We also see growth with mid-cap companies as interest rates are flat to down — benefiting these companies. M&A transactions also tend to increase when interest rates are flat to down, another growth opportunity. Good companies stand the test of time, generally outperforming their peers. Finding these companies is always our focus.

CHRIS SIDONI, GIBSON CAPITAL The start of this year has been less treacherous than originally feared for diversified investors. Non-U.S. stocks and value stocks here in the U.S. have performed nicely. The best opportunity today is one that should be easy to embrace: broad diversification. Specifically, that means including non-U.S. stocks, value stocks, and real estate in one’s investment mix. But it takes overcoming investor biases that favor familiarity and the tendency to cling to past outperformers. Investors should be rebalancing away from yesterday’s winners and incorporating greater diversification.