Our base scenario remains resilient for now

So far, the Year of the Fire Horse, confirms the expectations set out in our Global Outlook 2026. Following the market correction triggered by the escalation of conflict in the Middle East, the announcement of a ceasefire and the opening of negotiations have fostered a relative easing of volatility. Nevertheless, this stabilisation remains fragile and is accompanied by a marked decoupling between asset classes and geographical areas.

Fixed income markets continue to be dominated by the macroeconomic consequences of the energy shock, resulting in a significant rise in yields and a correction in bond prices. Conversely, equity markets continue to benefit from robust fundamentals, notably supported by the momentum of artificial intelligence (AI), although persistent sectoral and regional divergences remain.

 

Equities: AI and energy (in)dependency as important themes

We retain a constructive view on equities, even though the short-term upside potential may remain limited in an environment of geopolitical uncertainty and persistently elevated rates. Our regional convictions remain robust and are based on the analysis of economic trajectories and corporate fundamentals. Within this framework, we maintain a significant exposure to US equities in our allocations. The resilience of the US economy and its lower energy dependency continue to underpin the relative attractiveness of this market compared to other developed areas. Large-cap technology companies are delivering solid results, confirming the strength of their business models as they pursue substantial investments.

Emerging market equities remain a significant component, with Asian markets benefiting from AI, financed by an underweight position in Japan. Meanwhile, we maintain a more cautious approach to European equities, favouring large caps and themes linked to strategic autonomy.

 

Bonds: complex environment amid inflationary pressures and tighter policy

The bond environment remains complex, marked by inflationary pressures prompting certain central banks to adopt a more restrictive stance. In this context, sovereign bonds no longer fulfil their role as hedging assets. We therefore maintain a low sensitivity to rates in our diversified portfolios. Short and intermediate maturities in the Euro Area, however, incorporate a significant portion of the inflation shock and, in our view, may offer tactical reallocation opportunities.

We remain positive on European corporate bonds due to their solid fundamentals and profitability. Dollar-denominated investment grade corporate bonds present a more contrasted profile, notably due to the increasing concentration in the technology sector.

Emerging market debt in local currencies retains an attractive profile thanks to high real yields, even though this asset class remains exposed to episodes of volatility.

 

Currencies and gold: dollar supported for now, yen under pressure

The US dollar should continue to benefit from short-term support as long as geopolitical uncertainties persist, but may resume a downward trend in the medium term as reserves diversify. The yen remains under pressure due to energy dependency and its role as a funding currency.

Gold is struggling to extend its short-term gains, but remains supported in the medium term by solid fundamentals and the geopolitical context.