How do 8 top investment banks view 2026? Gemini has read and highlighted the key points for you.

Original Title: Bank Outlooks 2026 Research Plan

Original Author: szj capital

Original Source:

Repost: Mars Finance

As the year draws to a close, major institutions are once again releasing their outlooks for the coming market year.

Recently, overseas netizens compiled the annual outlook reports from eight top investment banks, including Goldman Sachs, BlackRock, Barclays, and HSBC, and had Gemini Pro3 provide a comprehensive interpretation and analysis.

Below is the full translated text, helping you save time and get an overview of next year’s key economic trends.

Executive Summary: Navigating the “K-Shaped” New World Order

2026 is set to be a period of profound structural transformation, no longer characterized by a single, synchronized global cycle, but rather by a complex matrix of diverse economic realities, policy divergence, and thematic disruptions. This comprehensive research report brings together forward-looking strategies and economic forecasts from the world’s leading financial institutions, including J.P. Morgan Asset Management, BlackRock, HSBC Global Private Banking, Barclays Private Bank, BNP Paribas Asset Management, Invesco, T. Rowe Price, and Allianz Group.

Collectively, these institutions depict a “bending but not breaking” global economic landscape: the past decade’s era of “easy money” has been replaced by a new paradigm of “higher for longer” interest rates, fiscal dominance, and technological disruption. Barclays Private Bank refers to the core theme of 2026 as “The Interpretation Game”—an environment of contradictory economic data and rapidly changing narratives, where market participants must proactively interpret conflicting signals, rather than rely on passive investing.

One of 2026’s central pillars is the marked divergence between the US and other countries. J.P. Morgan and T. Rowe Price argue that the US economy, powered by AI capital expenditures and fiscal stimulus known as the “One Big Beautiful Bill Act” (OBBBA), will have a unique growth engine. This stimulus is expected to inject an “adrenaline effect” of over 3% economic growth in early 2026, which will gradually fade; Allianz and BNP Paribas, on the other hand, expect the Eurozone to exhibit a “boring is beautiful” recovery mode.

However, beneath the surface growth figures lurks a more turbulent reality. Allianz warns that global business bankruptcies will reach “historic highs,” projecting a 5% increase in 2026 as the lagged effects of high interest rates deliver a final blow to “zombie companies.” This scenario sketches a “K-shaped” expansion: large-cap tech and infrastructure sectors thrive from the “AI Mega Force” (as BlackRock puts it), while small, leveraged businesses face existential threats.

Asset allocation consensus is undergoing a seismic shift. The traditional 60/40 portfolio (60% stocks, 40% bonds) is being redefined. BlackRock introduces the concept of a “New Continuum,” arguing that the divide between public and private markets is dissolving and investors need permanent allocations to private credit and infrastructure assets. Invesco and HSBC recommend a return to “quality” in fixed income, favoring investment-grade bonds and emerging market debt, and abandoning high-yield debt.

This report analyzes each institution’s investment themes, covering “Physical AI” trades, the “Electrotech Economy,” the rise of protectionism and tariffs, and the strategic focus investors should adopt in this divided world.

Part I: Macroeconomic Landscape—A World of Multi-Speed Growth

In the post-pandemic era, the synchronized global recovery many had hoped for has failed to materialize. The outlook for 2026 is defined by unique growth drivers and policy divergence. Major economies advance at varying speeds, shaped by their fiscal, political, and structural forces.

1.1 United States: The “North Star” of the Global Economy & OBBBA Stimulus

The US remains the undisputed engine of the world economy, but its growth drivers are evolving. No longer reliant solely on organic consumer demand, it increasingly depends on government fiscal policy and corporate capital expenditure on AI.

The “One Big Beautiful Bill Act” (OBBBA) Phenomenon

A key finding in J.P. Morgan Asset Management and T. Rowe Price’s 2026 outlooks is the anticipated impact of the OBBBA. This legislative framework is considered the defining fiscal event of 2026.

· Mechanism: J.P. Morgan notes that OBBBA is a broad legislative package that extends key elements of the 2017 Tax Cuts and Jobs Act (TCJA) while introducing new spending. It includes about $170 billion for border security (enforcement, deportation) and $150 billion for defense (such as the “Golden Dome” missile defense system and shipbuilding). Additionally, the bill raises the debt ceiling by $5 trillion, indicating ongoing fiscal looseness.

· Economic Impact: T. Rowe Price believes that, combined with AI spending, this act will help the US economy escape a growth scare at the end of 2025. J.P. Morgan predicts the OBBBA will drive real GDP growth to around 1% in Q4 2025 and accelerate to over 3% in the first half of 2026, as tax refunds and spending enter the economy directly. However, this surge is seen as a brief acceleration—a reversal of a “fiscal cliff”—with growth reverting to a 1-2% trend in the second half as the stimulus fades.

· Tax Impact: The act is expected to permanently maintain the 37% top individual income tax rate and reinstate 100% bonus depreciation and R&D expense deductions for corporations. Morgan Stanley notes this is a massive supply-side incentive that could drop effective corporate tax rates in certain sectors as low as 12%, fueling a “Capex Supercycle” in manufacturing and technology.

Labor Market Paradox: The “Economic Drift”

Despite fiscal stimulus, the US economy faces a major structural headwind: labor supply. J.P. Morgan describes this as an “Economic Drift,” noting that a sharp drop in net immigration is expected to lead to an absolute decline in the working-age population.

· Impact on Growth: This supply constraint means only about 50,000 new jobs are expected monthly in 2026. This is not a demand-side failure, but a supply-side bottleneck.

· Unemployment Ceiling: As a result, unemployment is expected to remain low, peaking at 4.5%. While this “full employment” dynamic prevents a deep recession, it also sets a hard cap on potential GDP growth, intensifying the sense of “drift”—an economy that feels stagnant despite positive data.

1.2 Eurozone: “Boring Is Beautiful” Surprises

In sharp contrast to the US’s volatility and fiscal drama, the Eurozone is gradually becoming a symbol of stability. Allianz and BNP Paribas believe Europe may outperform expectations in 2026.

Germany’s “Fiscal Reset”

BNP Paribas notes that Germany is undergoing a key structural shift, moving away from its traditional “Black Zero” fiscal austerity towards significantly increased infrastructure and defense spending. This fiscal expansion is expected to have a multiplier effect across the Eurozone, boosting economic activity in 2026.

Consumer Support Policies

BNP Paribas also highlights policies such as permanent reductions in VAT for catering and energy subsidies, which will support consumer spending and prevent demand collapses.

Growth Forecast

Allianz expects Eurozone GDP growth of 1.2%–1.5% in 2026. While modest compared to the US’s “OBBBA stimulus,” it represents a robust and sustainable recovery from the stagnation of 2023–2025. Barclays concurs, seeing room for “positive surprises” in the Eurozone.

1.3 Asia and Emerging Markets: The “Extended Runway” and Structural Slowdown

Asia’s outlook is clearly polarized: on one side, a maturing and slowing China; on the other, a vibrant and accelerating India and ASEAN region.

China: Orderly Deceleration

Most institutions agree that China’s era of high-speed growth is over.

· Structural Headwinds: BNP Paribas forecasts China’s growth to slow to below 4% by end-2027. T. Rowe Price adds that, while stimulus will be deployed, deep-seated real estate and demographic issues mean such measures are unlikely to provide “substantial lift.”

· Targeted Stimulus: Unlike broad-based stimulus, China is expected to focus on supporting “advanced manufacturing” and strategic industries. This shift aims to move up the value chain, at the cost of short-term consumption growth. Barclays forecasts Chinese consumption growth at just 2.2% in 2026.

India and ASEAN: Growth Engines

Conversely, HSBC and S&P Global see South and Southeast Asia as new global growth champions.

· India’s Growth Path: HSBC projects India’s GDP growth at 6.3% in 2026, making it one of the fastest-growing major economies. However, HSBC also warns tactically: despite strong macro conditions, near-term corporate earnings growth is relatively weak, creating a possible disconnect with high valuations, which may affect equity investors.

· AI Supply Chain: J.P. Morgan and HSBC both emphasize that the “AI theme” is a major driver for emerging Asia, especially Taiwan and South Korea (semiconductors) and ASEAN countries (data center assembly and component manufacturing). The extension of AI trade is a key regional catalyst.

1.4 Global Trade: The “Tax Effect” of Tariffs

A potential shadow over the 2026 outlook is a return of protectionism. HSBC has downgraded global growth expectations from 2.5% to 2.3%, mainly due to US-led “multi-purpose tariffs.”

Trade Growth Stagnation

HSBC predicts global trade growth of just 0.6% in 2026. This near-stagnation reflects a world where supply chains are shortening (“nearshoring”) and realigning to avoid tariff barriers.

Inflationary Pressures

T. Rowe Price warns that these tariffs will act as a consumption tax, causing US inflation to “remain above target.”

Part II: The Inflation and Interest Rate Conundrum

The era of “Great Moderation” before the 2020s has been replaced by a new normal of volatility. Stubborn US inflation is intertwined with European deflationary pressures, leading to a “Great Decoupling” in central bank policies.

2.1 Diverging Inflation

· United States: Persistent and Structural

T. Rowe Price and BNP Paribas believe that, due to OBBBA fiscal stimulus and tariffs, US inflation will stay elevated. J.P. Morgan provides more detail: inflation is expected to peak near 4% in early 2026 due to tariffs, then gradually fall back to 2% by year-end as the economy absorbs the shock.

· Europe: Deflationary Surprise

By contrast, BNP Paribas notes that Europe will face deflationary pressures, partly due to a “recycling” of cheap Chinese exports into the European market. This could push inflation below the ECB’s target, in stark contrast to the US trend.

2.2 Decoupling of Central Bank Policies

Diverging inflation dynamics are driving a split in monetary policy, creating opportunities for macro investors.

· Fed (“Slow” Path)

The Fed is expected to remain constrained. J.P. Morgan sees only 2–3 rate cuts in 2026. T. Rowe Price is more hawkish, warning that if OBBBA stimulus overheats the economy, the Fed may not cut at all in H1 2026.

· ECB (“Dovish” Path)

Facing weak growth and deflation, the ECB is expected to cut rates sharply. Allianz and BNP Paribas forecast the ECB will lower rates to 1.5%–2.0%, well below current market expectations.

· FX Market Impact

This widening rate differential (US rates staying high, Eurozone rates dropping) implies a structurally strong dollar versus the euro, contradicting the conventional view that the dollar weakens in late-cycle environments. However, Invesco holds the opposite view, betting a weaker dollar will support emerging market assets.

Part III: Thematic Deep Dives—“Mega Forces” and Structural Change

Investment strategy in 2026 is less about traditional business cycles and more about structural “Mega Forces” (a BlackRock concept) that transcend quarterly GDP data.

3.1 Artificial Intelligence: From “Hype” to “Physical Reality”

The AI narrative is shifting from software (like large language models) to hardware and infrastructure (“Physical AI”).

· “Capex Supercycle”: J.P. Morgan points out that data center investment now makes up 1.2%–1.3% of US GDP and is still climbing. This is not a fleeting trend, but a real expansion in steel, concrete, and silicon-based technology.

· “Electrotech Economy”: Barclays introduces the “Electrotech Economy” concept. AI’s energy demand is insatiable. Investing in grids, renewable generation, and utilities is seen as the safest way to ride the AI wave. HSBC agrees, recommending a shift toward utilities and industrials, which will “power” this revolution.

· Contrarian View (HSBC’s Warning): In stark contrast to market optimism, HSBC is deeply skeptical about the financial viability of current AI model leaders. Their internal analysis suggests that companies like OpenAI could face up to $1.8 trillion in compute rental costs, leading to a huge funding gap by 2030. HSBC argues that while AI is real, the profitability of model creators is questionable, further supporting their recommendation to invest in “tools and equipment” (chipmakers, utilities) rather than model developers.

3.2 The Private Markets “New Continuum”

BlackRock’s 2026 outlook centers on the evolution of private markets. They argue the traditional binary of “public markets” (high liquidity) and “private markets” (low liquidity) is outdated.

· Rise of the Continuum: Via evergreen structures, ELTIFs, and secondary markets, private assets are becoming semi-liquid. This democratization trend gives more investors access to the “liquidity premium.”

· Private Credit 2.0: BlackRock sees private credit evolving from traditional leveraged buyouts to “Asset-Based Financing” (ABF), with real assets (data centers, fiber networks, logistics hubs) as collateral, not just corporate cash flow. This, they argue, creates “deep opportunity increments” for 2026.

3.3 Demographics and Labor Shortages

J.P. Morgan and BlackRock both see demographics as a slow but unstoppable driver.

· Immigration Cliff: J.P. Morgan forecasts falling net migration as a key growth constraint for the US. Labor will remain scarce and expensive, supporting wage inflation and further incentivizing businesses to invest in automation and AI to replace human labor.

Part IV: Asset Allocation Strategy—“60/40+” and the Return of Alpha

Multiple institutions agree that 2026 will not suit the passive “buy-the-market” strategies popular in the 2010s. In the new environment, investors must rely on active management, diversify into alternatives, and focus on “quality.”

4.1 Portfolio Construction: The “60/40+” Model

J.P. Morgan and BlackRock clearly call for reforming the traditional 60% equities/40% bonds portfolio.

· The “+” Component: Both advocate a “60/40+” model, allocating about 20% to alternative assets (private equity, private credit, real assets). This aims to deliver uncorrelated returns and reduce overall volatility as stock-bond correlations rise.

4.2 Equity Markets: Quality and Rotation

· US Equities: BlackRock and HSBC are overweight US equities, thanks to the AI theme and economic resilience. However, HSBC recently trimmed its US exposure due to high valuations. They suggest rotating from “mega-cap tech” to broader beneficiaries (e.g., financials and industrials).

· International Value Stocks: J.P. Morgan sees strong opportunities in European and Japanese value stocks. These markets are undergoing a “corporate governance revolution” (buybacks, higher dividends), and their valuations are historically discounted versus the US.

· Emerging Markets: Invesco is most bullish on emerging markets, betting that a weaker dollar (contrary to other predictions) will unlock value in EM assets.

4.3 Fixed Income: The Revival of Yield

The role of bonds is shifting from relying on capital gains (rate cuts) to a renewed emphasis on “yield.”

· Credit Quality: With Allianz warning of rising bankruptcies, HSBC and Invesco strongly favor investment-grade (IG) over high-yield (HY) bonds. HY risk premiums are seen as insufficient to compensate for the coming default cycle.

· Duration Positioning: Invesco is overweight duration (especially UK gilts), expecting central banks to cut faster than markets expect. J.P. Morgan recommends “flexibility,” trading ranges rather than making large directional bets.

· CLOs: Invesco specifically adds AAA CLOs to its model portfolio, seeing their higher yields and structural safety as superior to cash.

4.4 Alternative Assets and Hedges

· Infrastructure: Infrastructure is the most favored “real asset” trade. BlackRock calls it a “cross-generational opportunity,” as it hedges inflation and directly benefits from the wave of AI capex.

· Gold: HSBC and Invesco both see gold as a key portfolio hedge. Amid geopolitical fragmentation and potential inflation volatility, gold is seen as essential “tail risk” insurance.

Part V: Risk Assessment—The Shadow of Bankruptcy

Despite the US’s strong macro outlook due to fiscal stimulus, credit data reveals a gloomier side. Allianz provides a sober counterweight to market optimism.

5.1 The Bankruptcy Wave

Allianz forecasts global business bankruptcies to rise 6% in 2025 and another 5% in 2026.

· “Lagged Trauma”: This rise is attributed to the delayed effects of high interest rates. Companies that locked in low rates in 2020–2021 will hit the “maturity wall” in 2026, forced to refinance at much higher costs.

· “Tech Bubble Burst” Scenario: Allianz explicitly models a downside scenario—an “AI bubble” burst. In this case, the US would see 4,500 additional bankruptcies, Germany 4,000, France 1,000.

5.2 Vulnerable Sectors

The report highlights several particularly vulnerable sectors:

· Construction: Highly sensitive to rates and labor costs.

· Retail/Discretionary: Squeezed by the “K-shaped” consumption trend, with low-income consumer spending sharply reduced.

· Auto Industry: Facing high capital costs, supply chain restructuring, and tariff wars.

This risk assessment further supports the trend toward “quality first” in asset allocation. The report warns investors to avoid “zombie” companies that survive only on cheap money.

Part VI: Comparative Analysis of Institutional Views

The following table synthesizes specific 2026 GDP and inflation forecasts from institutional reports, highlighting differences in expectations.

Conclusion: Strategic Imperatives for 2026

The investment landscape for 2026 is shaped by the tension between fiscal and technological optimism (US OBBBA, AI) and credit/structural pessimism (bankruptcy wave, demographics).

For professional investors, the road ahead requires abandoning broad index investing. The “K-shaped” economy—data centers booming while construction firms go bankrupt—demands active sector selection.

Key strategic points:

· Monitor the “OBBBA” pulse: The timing of US fiscal stimulus will determine the rhythm of the first half of 2026. Tactical trading strategies should focus on the “adrenaline effect” for US assets in Q1 and Q2, and the potential fade in the second half (J.P. Morgan).

· Invest in AI “tools and equipment”: Avoid pure AI model valuation risk (HSBC’s warning) and focus on physical infrastructure—utilities, grids, and data center REITs (Barclays, BlackRock).

· Diversify through private markets: Use the “New Continuum” to enter private credit and infrastructure, ensuring these assets are “asset-based” to withstand the bankruptcy wave (BlackRock, Allianz).

· Hedge the “Interpretation Game”: In a fast-changing narrative environment, maintain structural hedges such as gold and use “barbell strategies” (growth stocks + quality yield assets) to manage volatility (HSBC, Invesco).

2026 will not be a year for passive investing, but one for investors skilled at interpreting market signals.