Investment Outlook 2026
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Commodities - Technical Analysis
Signs of a turnaround have emerged for gold and silver, and a strong upward move could trigger the next upward wave. A breakout above the key downtrend lines could also be on the horizon, which would further reinforce the positive turnaround. The price of oil has broken below the 100-day moving average, weakening the bullish outlook, and with the uptrend broken, it has entered a correction phase. Natural gas is showing a correction following a sharp decline, but has not yet managed to break through its downtrend line. Copper continues to trade within a wide range and is approaching the lower end of that range. Following a significant decline, wheat and corn prices have reached key support levels from which an upward correction—or even a new uptrend—is likely to begin.
FX - Technical Analysis
The dollar's momentum has eased, but confirming a trend reversal would require a decisive bearish session against the euro. Against the British pound, however, the exchange rate remains in an uptrend. EUR/HUF continues to trade within a narrowing range, while the dollar remains in an uptrend against the forint. USD/JPY has broken out to the upside from its consolidation pattern, suggesting further upside potential. EUR/CHF previously broke below a key support level that had defined its uptrend, and the pair is now characterized by a downtrend.
Consumption and AI related investments saved the year in the US with 2% GDP growth, and despite the trade war and shutdown the outlook remained solid. Fiscal and monetary easing continues to provide strong tailwinds, but equities are expensive, meaning there is less and less room for error. We are therefore keep some powder dry, to increase equity exposure in case of drawdowns, and selectively choosing between sectors and regions for excess returns. Within Europe, we see potential in the cheapest small-cap segment, several factors could catalyze its outperformance in addition to the German stimulus.
Macro
Consumption and AI related investments saved the year in the US with 2% GDP growth, and despite the trade war and shutdown the outlook remained solid. Recession risk is low, but the weakening labor market, high and fast rising debt, halted disinflation above CB’s target, and political pressure on the Fed remain a cause for concern. Looser fiscal policy in the EU could add to GDP growth in 2026-2027, but debt sustainability issues can not be neglected. Inflation is at target levels, but risks are more tilted to the upside. In the short run we expect the market to price in more cuts as the new FED chair is getting closer, which will moderate long bond yields. In Europe, we still expect term premiums to rise. From the current level, we do not expect further meaningful HUF appreciation, but holding long positions remains to be attractive due to high interest rate differential.
Equities
Fiscal and monetary easing continues to provide strong tailwinds, but equities are expensive, meaning there is less and less room for error. We are therefore keep some powder dry, to increase equity exposure in case of drawdowns, and selectively choosing between sectors and regions for excess returns. In the US, we favor sectors primarily linked to the development of AI infrastructure, like semis on the hardware and cybersecurity on the software, utilities/renewables on the energy supply side. Within Europe, we see potential in the cheapest small-cap segment, several factors could catalyze its outperformance in addition to the German stimulus. The weakening dollar and Fed interest rate cuts are tailwinds for EM, but valuation is already neutral, so we prefer the cheapest Brazil and the nearshoring driven Mexico. After a long consolidation, we would also start building positions in the structural megatrends driven India. We see no change in the factors driving CEE so far, depressed valuations compensate for higher risks.
Bonds
While the weakening labor market and slowing growth are pushing yields lower, continued significant budget deficits and deteriorating debt trajectories pose risks in the opposite direction. For this reason, we continue to favor the short/medium end of the yield curve. Corporate bonds’ historically tight spreads do not cover the increasing risks.
Commodities
We maintain an overall neutral view on commodities, as energy and agricultural products remain weak for now. However, the outlook for industrial and precious metals remains favorable, so selective exposure is recommended. We like copper, uranium, and gold related exposures.
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