What bubble? Asset managers in risk-on mode stick with stocks

What we drew from this source

The claims Via News extracted from this document. We point to the source; we don't replace it.

• Any geopolitical situation affecting oil price, particularly Middle East and Ukraine/Russia situations, will have largest impact on financial markets

  80% confidence

• US has high-return high-growth companies reflected in valuations, but more interesting opportunities exist outside US

  80% confidence

• Cannot call tech a bubble when companies are delivering massive earnings beats, with tech earnings outstripping all other US stocks

  80% confidence

• Does not believe there will be a rebound in European auto sector

  80% confidence

• Concerned that everyone being risk-on creates concentration of positions with less tolerance for adverse surprises

  80% confidence

• More than three-quarters of 39 interviewed asset allocators were positioning portfolios for risk-on environment through 2026

  80% confidence

• Playing powerful trends in place and bullish through end of next year, not taking contrarian position

  80% confidence

• Sees improvements outside US including governance reform in Japan, capital discipline in Europe, and recovering profitability in emerging markets that will mandate allocations

  80% confidence

• Expectation of solid growth and easier monetary and fiscal policies supports a risk-on tilt in multi-asset portfolios with overweight stocks and credit

  80% confidence

• India has real potential to become Korea-like re-rating story of 2026, transitioning from tactical allocation to strategic core exposure in global portfolios

  80% confidence

• 85% of managers said valuations among Magnificent Seven and AI heavyweights are not overly inflated

  80% confidence

• Scenario where US inflation rebounds in 2026 would constitute double whammy for multi-asset funds penalizing both stocks and bonds, worse than economic slowdown

  80% confidence

• Healthcare sectors can surprise to upside in US markets due to mid-term election year policy support, attractive valuations with catch-up potential

  80% confidence

• Investors headed for 2026 need to have the Fed on their side

  80% confidence

• Expects earnings growth of more than 20% for US small caps after years of underperformance

  80% confidence

• Meaningful broadening of earnings momentum across market caps and regions including Japan, Taiwan, and South Korea, with potential for earnings growth revival in Europe and emerging markets in 2026

  80% confidence

• Earnings outlook brightened for small-cap stocks, industrials and financials, with small-caps and industrials benefiting from Fed rate cuts reducing debt servicing costs

  80% confidence

• American exceptionalism is far from dead and US will be key participant as AI spreads globally

  80% confidence

• Recommends starting year with sufficient or over-exposure to equities, predominantly in emerging market equities, with no expectation of recession in 2026

  80% confidence

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