Indexology^® Blog

S&P GSCI Outpaced BCOM, Stocks and Bonds

We recently published The S&P GSCI: Built for the Cycle, a 10‑year analysis of how broad commodity indices behaved across differing inflation regimes, and why the S&P GSCI’s production‑weighted design historically demonstrated a higher inflation beta than alternatives such as the Bloomberg Commodity Index (BCOM). This blog is a follow‑up, turning the focus to 2026 YTD performance. In the first five months of 2026, inflation re‑accelerated due to global conflicts constraining energy supplies. YTD performance aligned with findings explored in the longer study.

The S&P GSCI rose 37.7% through May 29, 2026, outperforming the Bloomberg Commodity Index (BCOM), which gained 25.0%. Both commodity benchmarks meaningfully outperformed equities (the S&P 500^® was up 11.3%) and bonds (the S&P U.S. Aggregate Bond Index was up 0.6%) during the period. We’ll see how an inflation shock highlighted the inflation-hedging characteristics of commodities, the implications of production weighting in the S&P GSCI and the substantial contribution of the Energy sector to commodity performance.

Commodities Outperformed as Inflation Accelerated

After ending 2025 at about 2.7% year-over-year, U.S. consumer inflation (CPI-U) climbed to about 4.3% year-over-year by May 2026, an increase of 1.6 percentage points since the start of the year. A key driver was rising energy prices, due to a sharp oil price shock that rippled through broader prices.

Historically, inflation shocks have typically benefited commodities, and 2026 was a textbook example. Commodity performance took off in early 2026 as inflation rose. By late March, the S&P GSCI TR had climbed to double-digit gains, peaking in mid-May with a YTD increase of over 50% before settling at 37.7% at the end of May. In contrast, the S&P 500 TR ended May up a solid but considerably lower 11.3%, while the S&P U.S. Aggregate Bond Index was essentially flat (up 0.6%) over the same period. In short, commodities (especially those that are Energy driven) significantly outperformed traditional assets during this inflationary spike.

GSCI versus BCOM: Production Weighting Shows Its Value

Within commodities, the S&P GSCI outpaced BCOM YTD in 2026, continuing a familiar pattern from the past decade. Through the end of May, the S&P GSCI’s gain of 37.7% topped the BCOM’s 25.0% by over 12 percentage points. This outperformance under inflationary conditions is consistent with the findings of the 10-year analysis: the S&P GSCI’s inflation beta was about 1.7× higher than the BCOM’s (9.1 versus 5.5, respectively), meaning that the S&P GSCI has historically moved about 65% more for each 1% move in inflation. The 2026 YTD data were consistent with this relationship, with the S&P GSCI reacting more strongly to the inflation surprise than BCOM.

To explain the S&P GSCI’s outperformance, we can point to the production-weighted structure embedded in the index weighting scheme, which may have contributed to relative performance when inflation-hedging characteristics were particularly relevant. This result is consistent with findings from the past decade—the S&P GSCI has exhibited stronger performance in higher-inflation regimes.

Energy Takes the Lead in 2026

The 2026 commodity rally was led by Energy. Within the S&P GSCI, the Energy sector gained 76.3% through the end of May, significantly exceeding the gains in all other sectors. For context, Industrial Metals was up 16.0%, Precious Metals rose 5.3%, and Agriculture and Livestock each climbed roughly 2% YTD.

These figures are consistent with the central findings of The S&P GSCI: Built for the Cycle, which highlighted how production weighting aligns a commodity index with the real-economy cost structure. When Energy prices have risen, an index weighted by the scale of global production tended to reflect that move in proportion to Energy’s economic footprint. The heavy Energy weight in the S&P GSCI is an important characteristic of inflation-responsive commodity weighting. Of course, greater sensitivity means accepting higher volatility, but as YTD 2026 has shown, the advantages could be significant during inflationary surges.

This content may be AI-assisted and is composed, reviewed, edited, and approved by S&P Global.

Cathy Clay, CEO of S&P Dow Jones Indices, and Lynn Martin, President of the NYSE Group, recently met on the trading floor of the New York Stock Exchange to discuss how the S&P 500 connects America’s past, present and future.  

Drawing on the index’s nearly 70-year legacy, they examine what has made the benchmark so iconic—its role in helping Americans participate in the economy, the enduring strength of the NYSE Group and S&P Dow Jones Indices partnership, and the way it continues to serve as a trusted compass for today’s markets. 

With broad market benchmarks trading at historically low yields and elevated valuations, it’s timely to examine the performance of the S&P Dividend Aristocrats^® Index Series in today’s market environment. These indices track companies with a consistent record of dividend growth and currently offer a combination of strong yields and reasonable valuations. Historically, they have also exhibited defensive qualities, which is relevant in an environment characterized by market volatility and a risk of pullbacks. Furthermore, as benchmark concentration has risen and technology stocks have come to dominate broad market indices, dividend-focused strategies show diversification characteristics owing to their broad sector profiles and sources of performance.

Methodology Review

The S&P Dividend Aristocrats Indices track companies that have followed a managed-dividends policy of consistently increasing dividends every year for several years. The S&P High Yield Dividend Aristocrats considers 20 consecutive years of increasing dividends, whereas the S&P Global Dividend Aristocrats Quality Income Index requires 10 consecutive years of increasing or stable dividends, alongside fundamentals-based quality metrics focused on assessing the sustainability of companies’ dividend payout policies. Both indices are weighted by indicated annual dividend yield (IAD yield), helping maintain a strong focus on income while prioritizing inclusion of companies with demonstrated dividend growth characteristics.

Dividend Yields Significantly Exceed Benchmark Universes

Dividend yield is a core metric for any income-focused strategy. Both the S&P High Yield Dividend Aristocrats and the S&P Global Dividend Aristocrats Quality Income Index have historically posted yields over twice those of their respective benchmarks (see Exhibit 2).

Valuations Remain Strong Relative to Benchmarks

Following an extended bull market and historically elevated valuations—particularly within the Information Technology sector—Exhibit 3 highlights that both indices continue to trade at meaningful valuation discounts relative to their respective benchmark universes.

Sector Diversification

Exhibit 4 shows the diversification characteristics of these indices, demonstrating a significant underweight in Information Technology while increasing weight in traditionally defensive sectors such Consumer Staples and Utilities.

Assessing Historical Defensive Characteristics

The S&P Dividend Aristocrats Indices have historically demonstrated stronger performance in weaker markets. Both indices have often delivered better relative performance during periods of higher volatility—especially when VIX^® rises above 20, a level often linked to increased market stress (see Exhibit 5).

Examining Performance over the Long Term

Over the long term, both the S&P High Yield Dividend Aristocrats and S&P Global Dividend Aristocrats Quality Income Index have outperformed their respective benchmarks on an absolute and risk-adjusted basis (see Exhibit 6).

Conclusion

Strong Q1 2026 inflows into dividend strategies suggest renewed demand for income and defensiveness amid heightened volatility and evolving macroeconomic conditions. The S&P Dividend Aristocrats Indices methodology focuses on companies with durable dividend growth and consistent income—traits often associated with mature, stable companies—which tend to have more robust operating models and have historically shown resilience in difficult markets while providing a measure of consistent dividend yield and diversification.

¹ Please see the S&P Dividend Aristocrats Indices Methodology for more information.

The U.S. market has been buffeted by swings in the performance of semiconductor companies, as investors have become increasingly anxious about the outlook for the tech sector and whether a regime change is in store. The choppiness has been global in nature, sparked by a steep sell-off in Korean chipmakers, with the S&P Korea BMI down 10.9% for the month as of July 15, 2026. The parallel between the two countries is notable, and although both markets vary widely in size, outperformance in both has been driven by a handful of semiconductor companies.^{1, 2, 3} The connections between the two markets strengthened upon the debut of chipmaker SK Hynix’s ADR listing, which shed more than 10% on its second trading day before rising more than 25% the following day.⁴

Exhibit 1 demonstrates how the weight of the three top-performing companies within each index have grown. The S&P Korea BMI’s performance, up 169% over the past year through June 30, 2026, was driven by chipmakers and hardware suppliers including PSK, SK Hynix and its holding company SK Square.⁵ The S&P 500^® was up 22% over the same time frame, and its top three performers—Sandisk, Western Digital and Micron—were, perhaps not coincidentally, also chipmakers. Though smaller in absolute terms, the relative growth in index weight of the U.S. companies was significantly higher than their Korean counterparts.

Offering a historical perspective and consistent with the rising weights of top-performing tech companies, Exhibit 2 shows that the weight of the Information Technology sector in the S&P 500 and S&P Korea BMI has grown considerably in recent years. As of June 30, 2026, Information Technology’s weight within the S&P Korea BMI was 69%, towering over the sector’s 38% weight in the S&P 500.

We can also examine the sources of U.S. and Korea index performance from an industry lens. As of Dec. 31, 2019, the Semiconductors & Semiconductor Equipment industry held 4% and 6% of the weight in the S&P 500 and S&P Korea BMI, respectively. By June 30, 2026, those weights had ballooned to 19% and 29%, respectively. Exhibit 3 demonstrates that the S&P Semiconductors Select Industry Index and the S&P Korea BMI Semiconductors & Semiconductor Equipment have significantly outperformed their respective sectors and country benchmarks.

While the U.S. equity market is almost 20 times larger than that of South Korea in terms of market capitalization, the countries are similar in terms of the increasing weight of chipmaker companies in their respective indices. Understanding the similarities and differences between both markets may be helpful for navigating whether semiconductors will continue to play an increasing role in the AI value chain and global markets overall.

¹ Ganti, Anu, “Cashing in the Chips?” S&P Dow Jones Indices LLC, June 2, 2026.

² Agarwal, Purvi, “Micron overtakes Meta, Tesla in market value amid relentless AI infrastructure demand,” Reuters, June 25, 2026.

³ Shan, Lee Ying, “SK Hynix surges 12% after Micron earnings; blockbuster Nasdaq listing,” CNBC, June 25, 2026.

⁴ Tan, Huileng, “Why SK Hynix’s wild swings aren’t only an AI story,” Business Insider, July 15, 2026

⁵ Samsung affiliated businesses were not included due to lower aggregate performance.

This content may be AI-assisted and is composed, reviewed, edited, and approved by S&P Global.

The S&P/ASX 200 Value gained 20.20% over the financial year ending June 30, 2026, outperforming the S&P/ASX 200 by more than 14% and its counterpart, the S&P/ASX 200 Growth, by more than 25%. This represents the index’s strongest one-year relative outperformance in over 16 years.

Following a long period in which Australian companies with growth characteristics outperformed in the 2010s, the rotation toward value started during the COVID-19 pandemic and has continued into the current environment of high interest rates, with the S&P ASX 200 Value outperforming the S&P/ASX 200 Growth over all time periods up to 15 years as of June 30, 2026 (see Exhibit 1).

It has been over 90 years since Columbia Business School professors Benjamin Graham and David Dodd published Security Analysis, a work that established the foundational principles of value investing. Both Graham and Dodd, along with numerous other academics and investment practitioners, have since evolved and developed the tenets of value investing. Today, the value versus growth dynamic persists in financial markets and often serves as a lens through which both active and passive investors determine investment allocations.

S&P Dow Jones Indices calculates value and growth barometers across global, regional and single-country indices, including the S&P/ASX 200, as previously referenced. Based on price multiples, earnings and sales growth, companies are ranked by style scores and classified as pure value, pure growth or blend. Please refer to the S&P/ASX Style Indices Methodology for more information.

Companies classified as “blend” (those ranked in the median cohort) can have their float-adjusted market capitalization proportionality split across both the value and growth indices. The style bias approach results in two distinctive indices within a given universe—for Australia, these are the S&P/ASX 200 Value and S&P/ASX 200 Growth.

Outside the U.S. market—where performance has been largely driven by growth stocks such as the “Magnificent Seven”—value stocks have outperformed in many other developed markets. Over the past five years, value has meaningfully outpaced growth in Canada, Japan and Europe.

Australia has followed suit, with the S&P/ASX 200 Value outperforming the S&P/ASX 200 Growth by more than 53% on a cumulative basis over the five years ending June 30, 2026. Furthermore, the S&P/ASX 200 Value has consistently outperformed the S&P/ASX 200 Growth by more than 7% per year across rolling five-year periods throughout the 2026 financial year.

Changing Sector Composition of S&P/ASX 200 Style Indices

The performance drivers of the S&P/ASX 200 Style Indices extend beyond a simple Financials versus Materials sector dynamic. Value factors such as book-to-price, cash-flow-to-price and sales-to-price ratios are affected by share price movements, which can influence style scores and, in turn, the classification of companies as pure value, pure growth or blend.

As a result, the sector composition of the S&P/ASX 200 Style Indices can shift over time, reflecting changes in share prices as well as the sales and earnings growth of underlying companies.

The rising valuations among the large banks have increased Financials’ representation in the S&P/ASX 200 Growth, which now includes the Commonwealth Bank of Australia.

By contrast, the S&P/ASX 200 Value is currently below its long-term average weight in Financials and above its long-term average weight in Materials, as of June 30, 2026. The weight of Materials has increased by approximately 20% over the five years leading up to June 30, 2026, while Financials’ weight has declined.

Conclusion

Australian market participants have historically been less style-aware in their domestic equity allocations than institutional and international investors. Given their distinct performance characteristics, the S&P/ASX 200 Growth and S&P/ASX 200 Value offer a recognized framework for market participants and academics to assess market dynamics relative to the broad S&P/ASX 200.

This content may be AI-assisted and is composed, reviewed, edited, and approved by S&P Global.