Propelled by five consecutive all-time closing highs to end the quarter, the S&P 500 enjoyed its second-best first half since the dot com bubble. The first quarter of the year had been highlighted by soaring value stocks, meme stock mania and a reflation trade as the global economy showed signs of synchronized growth. Stock leadership in the second quarter looked vastly different, however: Growth stocks reasserted themselves as the economic narrative shifted from seemingly limitless expansion potential to “peak everything.” Thanks to the strong outperformance earlier in the year, value stocks still held an edge for year-to-date performance—but the gap narrowed from nearly 10.5 percentage points to just two. Mega-cap stocks were the driving force behind the record close at quarter end as the S&P 500 Equal Weighted Index was unable to reclaim its all-time high reached in the beginning of June. Similar to the value/growth dynamic, Mid and Smallcap stocks still held a performance edge for the year to date but saw their largecap peers outperform for the quarter. Looking abroad, foreign stocks largely lagged the US returns as questions surrounding the reflation trade dented Emerging Markets and Covid variants led to fresh lockdowns in some European countries.