Why the Russell 2000 Is Outperforming the S&P 500 in May 2026

In this episode of The Economic Forecast Podcast, Lucas and Luna examine the striking divergence between the Russell 2000 and the S&P 500 in late May 2026. With the Russell up 6.1% over the past week against the S&P 500's 2.2% gain, small caps are surging while large caps lag. They dig into the drivers: a flattening yield curve, stabilizing inflation expectations, and the market's bet on a more accommodative Fed under the new chair. Specific numbers include the 10-year Treasury yield falling to 4.49%, the 2-year at 3.58%, and the VIX dropping to 17.03. They also consider headwinds like the Iran conflict and consumer sentiment at a record low. A must-listen for anyone tracking market rotations and the economic outlook mid-2026. #Russell2000 #SmallCaps #S&P500 #StockMarket #YieldCurve #FederalReserve #Inflation #VIX #MarketRotation #EconomicForecast #Investing #TreasuryYields #ConsumerSentiment #IranConflict #May2026 #BusinessPodcast #FexingoBusiness #Economics Keep every episode free: buymeacoffee.com/fexingo