Morgan Stanley chief cross-asset strategist Serena Tang says the agency stays constructive on danger belongings for the remainder of 2026 regardless of rising uncertainty tied to geopolitics, vitality costs and credit score markets.
In a brand new Ideas on the Market podcast episode, Tang says the financial institution expects the US economic system and company earnings to stay resilient, whereas synthetic intelligence (AI) spending continues to drive a significant funding cycle throughout industries.
Tang says the present macro backdrop nonetheless helps danger belongings.
“Throughout markets, macro and micro fundamentals help danger belongings. Within the US, progress ought to maintain up.”
The strategist additionally highlights Morgan Stanley’s bullish forecast for US equities and earnings progress.
“Our US Fairness Strategist’s S&P 500 goal for mid-2027 stands at 8,300, supported by anticipated earnings progress of 23 p.c in 2026 and 12 p.c in 2027. The momentum is coming from enhancing earnings.”
Tang notes that AI-related funding in information facilities, chips, energy programs and networks is predicted to stay a dominant power throughout markets, although the spending growth might additionally strain credit score markets as firms concern extra debt to finance growth.
Morgan Stanley says it continues to favor US equities over core mounted revenue.
“That’s why we suggest a balanced allocation with a risk-on tilt: chubby equities, underweight core mounted revenue, and maintain different mounted revenue, commodities and money at benchmark weight. Inside equities, we favor the U.S. as a result of earnings look sturdy and the risk-reward appears to be like higher than in different areas. Europe and Japan additionally provide upside, however Europe has extra publicity to vitality disruptions, and rising markets lack a broad macro and micro narrative regardless of pockets of energy.”
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