Small-cap stocks' outperformance has been driven by AI infrastructure spillover from tech leaders, but this tailwind is fading as index reconstitution reduces AI stock weighting
Too little corroboration in the last 3 days to call a trend (2 articles). Watching for it to gain traction.
"A massive catalyst behind the recent boom was the artificial intelligence sector, with 40% of year-to-date gains driven entirely by AI infrastructure stocks... a recent rebalance of the Russell 2000 index structurally altered this momentum, slashing the index's critical AI infrastructure exposure cleanly in half—moving from 15% down to just 7%."
"According to the bank, the small-cap rally can be largely attributed to AI, with the infrastructure boom trickling down from the tech sector's leaders. The Russell 2000 recently went through its June 2026 reconstitution, which slashed the weight of the index's AI infrastructure stocks in half, reducing it from 15% to 7%."