Where to invest in the second half of 2026?
Updated:
9 JUL, 2026
By Joanna Piwko from RankiaPro Europe
Knowing where to invest in the second half of 2026 has become a more complex task than investors anticipated at the beginning of the year. The conflict in the Middle East and the closure of the Strait of Hormuz have triggered an energy supply crisis that has spread through global supply chains, pushing inflation up just when central banks were hoping to continue easing their monetary policy.
In the United States, growth is largely based on investment in artificial intelligence, which already represents a decisive part of GDP expansion. The Federal Reserve, now under the chairmanship of Kevin Warsh, faces the dilemma of balancing political pressures with the need to contain long-term inflation expectations. In the euro zone, the impact of the energy crisis is added to the trade and technological war, forcing several managers to revise their growth forecasts downwards, while the European Central Bank considers new rate hikes to protect its credibility. China, for its part, combines political stability with an economy that is beginning to show signs of "Japanization", weighed down by its real estate sector.
In this context of higher rates for longer, demanding valuations in equities and volatility that can rebound in the face of any geopolitical surprise, managers do not share a single diagnosis on where to invest in the second half of 2026: while some firms maintain optimism based on nominal growth and the AI theme, others have chosen to reduce the risk of their portfolios waiting for greater clarity. Next, we review the perspectives by asset class.
Equities: where to invest in the second half of 2026?
Opinions are divided between selective optimism and caution. While some managers continue to bet on profit growth linked to artificial intelligence - expanding the focus from hardware manufacturers to hyperscalers and data centers - and see potential in European banking and the aerospace sector if the geopolitical situation calms down, other firms prefer to overweight more defensive sectors such as utilities, health or consulting, avoiding direct exposure to banks, energy and companies linked to AI.
Fixed income: short durations and credit quality
The consensus among managers points to maintaining reduced durations due to the risk of long-term debt yields continuing to rise, pressured by resilient growth, persistent inflation, and the deterioration of fiscal dynamics.
The high-quality credit, especially from the financial sector, remains the preferred bet, with carry as the main source of profitability in an environment of tight spreads.
Emerging markets: the big bet for the second half of 2026
The expectation of a weak dollar during the second half of the year enhances the attractiveness of emerging markets, which could lead, along with Europe, a cyclical rebound if energy flows through the Strait of Hormuz are fully normalized.
Managers highlight that this is one of the areas best positioned to benefit from the weakness of the US currency.
Private markets: alternatives to diversify the portfolio
Alternative assets gain prominence as a source of income and diversification in an environment of structurally higher inflation. Private credit —through direct lending, bank loans, and AAA-rated CLOs— and infrastructures focused on energy efficiency, digitization, and circular economy are shaping up as the areas with the most potential for investors seeking decoupling and protection against inflation.
Currencies: the role of the dollar in investment prospects
The weakness of the US dollar remains one of the firmest convictions among managers, who believe that the currency is still overvalued according to usual metrics. This scenario favors assets denominated in other currencies, especially in emerging markets.
Commodities: the energy factor that conditions the market
The closure of the Strait of Hormuz and the damage to the Gulf's energy infrastructures have generated a serious supply crisis that goes beyond oil, also affecting LPG, LNG, and key refined products for sectors such as fertilizers, plastics, or semiconductors.
The normalization of maritime traffic and the reconstruction of strategic inventories suggest that prices could take time to return to pre-conflict levels.
