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Bailey McCann, Opalesque New York: Swiss bank Julius Baer is betting on resilience in 2026, despite global turmoil.
In its most recent mid-year market outlook, the bank says that while 2026 is not playing out in ways anyone would have expected, global markets have shown surprising resilience in the face of uncertainty. Julius Baer expects that investors and markets will continue to play through the energy shock as a result of the conflict in Iran and notes that many countries are already working on backup plans for logistics as negotiations on the Strait of Hormuz are ongoing.
"We have a constructive global stance on equities," the outlook says. "Strong earnings and AI momentum support US
equities, while Asia - China and Japan, specifically
- forms an integral part of the AI value chain. India
remains attractive with longer-term upside, and Sin-
gapore and Switzerland offer defensive strength.
We now also favour Spain and Italy over Germany
and France due to their exposure to banks and
electrification-linked utilities."
Investment teams are also closely watching the growth of generative AI and are interested, provided that companies can demonstrate a clear cut path to profitability and free cash flow.
As markets get more clarity on the total impact of the conflict with Iran, Julius Baer anticipates a strong opportunity set in fixed income as well. "Corporate
investment-grade bonds and see diversification benefits in GBP-denominate...................... To view our full article Click here
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