The US stock market has climbed the wall of worry and the economy has held firm, RBC Wealth Management suggests in its Global Insight Mid-Year 2026 Outlook released on June 15, 2026. Despite a demanding backdrop of geopolitical tension, elevated Treasury yields, and looming midterm election uncertainty, the firm notes that corporate earnings have been the great stabilizer this year. The profit outlook for 2026 and 2027 has brightened notably since January, with the bull market persisting into its fourth year.

"Corporate earnings have been the great stabilizer this year, and the profit outlook for 2026 and 2027 has brightened notably since January," said Kelly Bogdanova, Vice President and Portfolio Analyst at RBC Wealth Management–U.S. "The bull market is persisting into its fourth year, the economy remains resilient and investors who stay disciplined are being rewarded, even with real hurdles still ahead."

US equities: Earnings brighten as market eyes midterm elections

The US stock market has shown notable resilience in 2026, with the S&P 500 rallying year-to-date through mid-June and the Information Technology sector outperforming sharply. The Information Technology sector delivered a standout first quarter, posting 49% year-over-year profit growth, with AI capital spending providing continued upward momentum to consensus earnings forecasts across multiple sectors.

With the midterm elections approaching on November 3, RBC Wealth Management is mindful that the S&P 500 has experienced an average 21% correction surrounding midterm election years since 1934. Additional volatility cannot be excluded, particularly if Treasury yields continue to rise or midterm election angst materializes. RBC Wealth Management recommends maintaining a Market Weight position in US equities, while scrutinizing Technology holdings where sharp rallies could give way to meaningful volatility.

US fixed income: Yields could reach new cycle highs

Global bond markets are navigating a challenging stretch at the midpoint of 2026, with rising yields pushing total returns modestly into the red year-to-date. Thirty-year government bond yields across major economies are at or near twenty-year highs, with the simple average breaching 4.0% for the first time since early 2009.

RBC Wealth Management's base case is that the Fed holds rates steady through 2026, but with a clear bias toward potential hikes. The firm sees scope for the benchmark 10-year Treasury yield to test key highs from this cycle: 4.8% from 2025 and potentially the 5.0% level from 2023. With bond price appreciation likely to remain elusive, RBC advises investors to focus on maximizing income.

Trends: Unstoppable forces reshaping long-term investment

RBC Wealth Management's mid-year outlook identifies five trends set to shape investment portfolios for decades. The impactful forces are driven by demographics, transformative advances in science and computing, rapidly shifting energy economics and intensifying geopolitical friction.

U.S. stock futures rose on Thursday, with the Nasdaq 100, S&P 500, and Dow Jones indices advancing, as investors looked past escalating tensions with Iran and focused on upcoming economic data. The market recovery follows a session where the S&P 500 fell 1.62% to close at 7,266.99, its steepest decline in weeks, driven by renewed hostilities in the Middle East and weakness in semiconductor stocks. Investors are now awaiting the release of May's producer price index (PPI) and weekly jobless claims for further cues on inflation and the health of the economy.

Market Drivers and Geopolitics

Middle East tensions escalated significantly as the U.S. and Iran traded direct military strikes, following warnings from President Donald Trump that Tehran would "pay the price" for stalled peace talks. The renewed hostilities have disrupted regional stability, prompting neighboring countries like Kuwait to temporarily close their airspace. Despite these geopolitical risks, market sentiment improved in premarket trading, supported by expectations that the Federal Reserve will keep interest rates unchanged in June. The CME Group's FedWatch tool indicates a 98.3% likelihood of rates remaining steady.

Futures Performance

Major indices showed strength in premarket trading, indicating a rebound from Wednesday's losses.

The SPDR S&P 500 ETF Trust (NYSE: SPY) rose 0.81% to $731.39, while the Invesco QQQ Trust ETF (NASDAQ: QQQ) advanced 1.38% to $703.29.

Stocks in Focus

Several stocks made significant moves ahead of the opening bell. Oracle Corp. (NYSE: ORCL) dropped 8.87% in premarket trading despite better-than-expected fourth-quarter results, as its remaining performance obligations rose and the CFO predicted lower gross margins for fiscal year 2027. Conversely, Visa Inc. (NYSE: V) gained 0.37% following a partnership announcement with OpenAI for AI agent payments. CoreWeave Inc. (NASDAQ: CRWV) was up 1.35% after announcing its intention to offer $3.5 billion in senior notes due 2032. Oxford Industries Inc. (NYSE: OXM) fell 6.61% after reporting mixed first-quarter results and narrowing its sales outlook for FY2026.

Economic Data and Analyst Views

Investors are closely monitoring initial jobless claims for the week ending June 6 and May's PPI data, both due before the opening bell. Economists polled by Dow Jones expect the PPI to show wholesale inflation rising 0.7% month-over-month, a decrease from April's 1.4% increase. BlackRock maintains an overweight stance on U.S. equities, citing contained damage to global growth from the Middle East conflict and strong earnings expectations, particularly in technology and AI beneficiaries. However, the firm warns of persistent macro challenges and sticky price pressures, advising investors to build portfolios around specific exposures rather than traditional asset class labels.