“We maintain a significant exposure to US equities in our allocations. The resilience of the US economy and its lower energy dependence continue to underpin the relative attractiveness of this market compared to other developed areas,” Adrien Roure multi-asset portfolio manager at Indosuez Wealth Management, said. “Large-cap technology companies are delivering solid results, confirming the strength of their business models as they pursue substantial investments.”

In his view, these companies remain quality assets, endowed with strong pricing power and innovation capacity, able to sustainably support earnings growth and the performance of US equity indices.

“Emerging market equities remain a significant component of our asset allocation approach. Asian markets offer an attractive diversification profile and privileged exposure to AI via South Korea, Taiwan, and China,” Roure continued. “This allocation continues to be financed by an underweight position in Japan, which faces persistent monetary constraints and a high degree of energy dependence.”

Derrick Irwin, senior portfolio manager and co-head of intrinsic emerging markets equity at also believes that Chinese technology companies offer a compelling counterbalance for investors seeking long-term AI exposure, especially as concerns grow over potential overbuild in US AI infrastructure.

“Chinese AI has absorbed much less capital expenditure and could prove to be higher-return investments than AI investments in the US,” Irwin said this week. “We maintain a constructive view on emerging market (EM) equities heading into the second half of 2026. Unlike a decade ago, when vulnerabilities such as large current account deficits defined the “Fragile Five,” many of these economies have strengthened external balances and fiscal positions. This structural improvement reduces systemic risk and provides a foundation for a more broad-based equity rally.”

Irwin expects emerging market performance to be driven by multiple factors beyond AI, including domestic consumption growth, policy support, and sector diversification. “We see earnings growth accelerating. Consensus earnings are expected to rise from approximately 15 per cent in 2025 to more than 20 per cent in 2026. Flows have begun to accelerate into emerging market equities,” Irwin said. “Emerging market equities saw $31 billion in inflows last year and $78 billion year to date. Although flows have slowed following the Iran crisis, we see room for more than $500 billion in additional flows into the asset class in the medium term.”

Dr Luca Bindelli, head of investment strategy at Swiss private bank also kept his moderate pro-risk stance in portfolios, favouring emerging market equities, emerging market hard-currency bonds and gold.

Meanwhile, Roure maintains a more cautious approach to European equities after having reduced his exposure during the spring rebound. “The region remains particularly exposed to the effects of the energy shock, with its impact expected to continue spreading through the economy,” Roure said. “While the weight of the energy sector may partially support earnings revisions, weaker growth and restrictive financial conditions could penalise cyclical and domestic segments, such as small and mid-cap stocks.” He therefore favours large capitalisations and themes linked to European strategic autonomy such as renewable energies, defence, and critical materials.

Fixed income
In fixed income, Roure believes that the environment remains complex, leading to a preference for low duration and quality credit, alongside selective opportunities in emerging market debt. Within this framework, the firm highlighted that Latin America stands out with renewed economic importance, driven by strong commodity exports and dominance in critical minerals, accounting for a significant share of global lithium, copper, and silver production. The region benefits from nearshoring trends and shifting global trade dynamics, with countries like Mexico gaining from supply chain realignment, while Brazil, Chile and Argentina attract investment across energy and mining. Combined with its role in global food security and expanding energy production, Latin America is increasingly positioned as a strategic pillar of emerging market allocation, offering both cyclical support and long-term structural opportunity.”

Macro backdrop
Indosuez highlighted that the current macro backdrop is shaped by more powerful AI emerging than by geopolitics, supporting a resilient growth environment despite higher inflation and energy volatility. While commodity prices remain elevated amid a global guessing game around the Strait of Hormuz, Indosuez expects inflation to gradually normalise, with US inflation easing relatively quickly as tariff effects unwind and oil stabilises. More broadly, inflation has become a fragmented story across regions, with energy exposure, labour markets, and policy driving divergent outcomes.

Regionally, the US continues to benefit from anchored inflation expectations and strong AI-driven investment, while the euro area faces more persistent pressures, prompting precautionary hikes from the European Central Bank (ECB) in response to energy-driven inflation, Indosuez continued. Asia remains resilient with uneven inflation risks, supported by the AI supply chain but increasingly fragmented across countries. Against this backdrop, markets are characterised by a marked decoupling between asset classes and geographical areas, with bonds under pressure from inflation while equities remain supported by AI momentum.