AI Set to Drive Market Performance Through 2026 Despite Geopolitical Risk

Despite a landscape defined by volatile energy costs and geopolitical instability, major investment firms remain largely bullish on the tech sector. Research conducted among 33 market experts shows that 88% anticipate AI-driven productivity gains will directly bolster corporate profits, with a solid majority expecting US equities to maintain their market lead throughout the remainder of the year. While recession fears have largely receded compared to 2025, strategists remain vigilant regarding concentration risk, noting that market returns are currently heavily skewed toward a small cluster of AI-focused companies.

Inflation remains a top-tier concern, with 97% of surveyed experts citing it as a significant risk factor, largely fueled by energy market disruptions linked to the Strait of Hormuz. Although many believe oil prices have reached their peak, the potential for renewed conflict keeps energy security at the forefront of investment strategy. Consequently, institutional thinking is shifting; nearly half of the strategists now question the traditional safe-haven status of Treasury bonds, increasingly favoring investment-grade credit and infrastructure as more reliable vehicles for stable cash flows in an era of deglobalization.