The Stock Market Keeps Climbing. But the U.S. Economy is Moving at a Slower Pace

The S&P 500 has gained nearly 10% during the first half of 2026, while the Dow Jones Industrial Average is up almost 9%, marking its strongest first-half performance since 2021. (Credit: Michael M. Santiago/Getty Images)

The U.S. stock market continues to post strong gains in 2026 even as the broader economy expands at a far more modest pace, highlighting a growing disconnect that economists say is being driven largely by the artificial intelligence boom.

The contrast has left many Americans wondering why Wall Street appears to be thriving while economic indicators are down. According to economists, the answer lies in the fundamental differences between what the stock market measures and what drives the broader U.S. economy.