Equity market performance in December was mixed, capping off a strong year led by technology themes and fueled by investor optimism surrounding artificial intelligence. Although the S&P 500® index advanced by over 16% for the year, more diversified indexes lagged behind, as returns were highly concentrated, with strong contributions from high-beta and momentum factors. The equally weighted S&P 500 index posted respectable double-digit gains but significantly trailed the headline performance of the market-cap-weighted S&P 500. With 2025 now behind us, we turn our attention to 2026 and the drivers likely to impact market performance. Consensus targets suggest that S&P 500 earnings growth should remain in double digit territory with the technology sector once again expected to lead all 11 S&P 500 industry sectors. However, earnings growth across sectors is also anticipated to broaden significantly in 2026, which could support improved market breadth and provide a more favorable environment for investors seeking to avoid sector concentration.