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Investment Outlook: HSBC Perspectives Q4 2026

3 September 2026

Willem Sels

Global Chief Investment Officer, HSBC Private Bank and Premier Wealth

Accelerating AI adoption powers further upside for global markets

Markets have faced a range of stress tests in recent months, with geopolitical conflict, supply chain disruptions, oil price spikes, inflation angst and the impact of AI all creating uncertainty. Yet, stronger earnings and resilient economic activity have offset these factors and driven equity markets higher. Clearly, AI has been instrumental, and its impact is also increasingly broadening.

Heading into the final quarter of 2026, that dichotomy remains in place: AI continues to be a key source of market optimism, while headline risks remain elevated. The situation in the Middle East remains unresolved, inflation uncertainty is lingering and the US mid-term elections are looming. These forces will continue to move markets, providing both risks and opportunities. The good news is that the global economy and corporate world are in better health than many expected, so we believe the positives outweigh the negatives.

What does this mean for investors?

AI adoption continues to accelerate, with more powerful models and new applications fuelling investment and market optimism. The benefits aren’t just seen in the tech sector, as AI also increases demand for electricity, materials and financing. Robotics, automation, healthcare, consumer services and other industries are also benefitting from AI-powered innovation.  Monetisation is key to identifying the winners.

Blending growth and income opportunities through a multi-asset strategy

We believe earnings growth will continue to broaden beyond the tech sector and US stocks. Asia is a key beneficiary of global chip demand and is at the forefront of data centre expansion, playing a strategic role in the global AI supply chain. AI adoption is also boosting productivity around the world – including in Europe. Beyond AI, defence spending and US re-industrialisation are also contributing to wider opportunities in Financials, Materials and Energy across regions, supporting diversification. Therefore, we’ve recently added exposure to global equities, favouring the US and Asia, while maintaining a broad sector allocation. The opportunity set extends to bonds, where attractive real yields offer both income and portfolio resilience against market volatility.

A US rate hike is unlikely in the near term, as long as high energy prices aren’t translating into higher core inflation. This remains our base scenario, as the US Federal Reserve won’t want low-income households to bear the pressure of higher rates. Even though increased bond issuance to fund AI investments has pushed up yields, the additional supply has been well absorbed by global investors. Therefore, we see limited risk of further yield spikes and prefer locking in current yields on quality bonds with medium duration.

Our exposure to non-traditional assets, such as gold, infrastructure and alternative assets, has worked well, providing a valuable counterbalance during periods of market uncertainty when equities and bonds come under pressure. Among alternative assets, private assets can open up a wider range of opportunities beyond public markets.

This edition also includes our recent interview with Stephen A. Schwarzman, Chairman, CEO and Co-founder of Blackstone, who shared his guiding principles for investing as part of our Think Wealth thought leadership series.

We hope our four investment themes for the coming quarter can help you make sense of a fast-changing world and position your portfolio for the opportunities it presents. Our team is ready to help you put these themes into action.

Investment themes

Key data to watch

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Notes
The above comments reflects a 6-month view (relatively short-term) on asset classes for a tactical asset allocation. For a full listing of HSBC’s house view on asset classes and sectors, please refer to our Investment Monthly issued at the beginning of each month.
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