.png){kind=logo}
US equities have shown sharp, earnings-driven swings in 2026, even as the headline index has stayed calm. Traders have also priced in fresh risks from artificial intelligence, which has widened gaps between winners and losers across the S&P 500.
More than 20% of S&P 500 constituents have gained or lost over 20% so far this year. Risers have outnumbered fallers by about two to one, yet the S&P 500 has remained roughly flat. Market data from Citadel Securities shows the gap between big stock moves and muted index returns has reached its highest level since 2009.
Citadel Securities strategist Scott Rubner described the current environment as “extreme” dispersion. He said AI-driven shifts have accelerated repricing for business models investors now view as vulnerable. This activity has pushed capital into new areas, even as index-level performance has stayed contained.
Investors have focused on two AI-related themes at once. They have questioned whether heavy AI spending will deliver near-term payoffs. They have also assessed which industries AI could disrupt through automation and pricing pressure. Those concerns have weighed on parts of tech and on sectors linked to software and logistics.
Several large technology companies have outlined major capital plans tied to AI infrastructure. Amazon, Microsoft, and Alphabet, alongside Meta, have signaled combined AI-related spending plans of about $660bn for this year, up about 60% from last year. Markets have treated those figures as a key input for valuations across the AI supply chain.
AI disruption worries have also spread beyond public software stocks. Software and services have lost about $2 trillion in market value from an October peak. BNP Paribas has estimated that roughly a fifth of private credit exposure ties to software, which has added pressure to some alternative asset managers.
Corporate results have acted as a major catalyst for single-stock volatility. Earnings for the S&P 500 rose about 12% year on year in the final quarter of 2025, based on Bloomberg-compiled data. This marked the fourth straight quarter of double-digit earnings growth.
Individual reports have driven fast repricing. Deere shares jumped more than 10% after results, while Spotify gained almost 15% after it tripled profits year on year, then fell 8% two days later. Those moves have reinforced an earnings-led market where stock selection matters more than broad index exposure.
The shift has improved conditions for active managers. More than half of large-cap mutual funds have outperformed their benchmark so far this year, the strongest showing in nearly two decades, according to Goldman Sachs analysts cited in the report.
At the same time, over 60% of S&P 500 stocks have beaten the index, while the ‘Magnificent 7’ group has fallen 5.6% since early January.
Also Read: US Stock Market Today: Wall Street Holds Steady as Q4 GDP Slows to 1.4% and Core PCE Rises 0.4%
