Small-Cap ETFs Rally In 2026; Wells Fargo Flags Earnings & Debt Problems - iShares Core S&P Small-Cap ETF
Wells Fargo Investment Institute said 2026 small-cap gains may be masking weaker fundamentals, citing falling earnings expectations for Russell 2000 firms and higher debt burdens. MarketWatch reported IWM-linked EPS estimates have weakened while large-cap funds’ rose. Through May 18, Russell 2000 earnings forecasts fell 7% vs S&P 500 up 8%. Flows show IWM down $8B+ vs IJR up ~$2B, favoring profitability screens.