The stocks this small-cap fundie is backing despite rate rise talk

Michael Steele is the co-portfolio manager of Yarra Capital Management’s Australian Smaller Companies Fund. The Melbourne firm manages about $20 billion in assets.

Will 2026 be another big year for small-cap investors?

After two years of earnings declines, the 2025 financial year was an inflection point which saw the small-caps market return to earnings growth of 7 per cent. We expect that positive earnings trend to accelerate in the 2026 financial year, with earnings growth of more than 15 per cent.

Source: https://www.afr.com/markets/equity-markets/the-stocks-this-small-cap-fundie-is-backing-despite-rate-hike-fears-20260121-p5nvq4