"The U.S. and European stock markets are at all-time highs and are expected to continue rising in 2026. However, according to most economic forecasts, the various open geopolitical fronts call for caution. In the first 10 days of the year, the U.S. has militarily intervened in a country and kidnapped its head of state. Interference in Venezuela has given way to President Donald Trump's threats against Colombia and Greenland. The possibility of invasion and annexation has generated uncertainty, which is the last thing investors like."
"Furthermore, some specters of 2025 are resurfacing. The noise surrounding a possible artificial intelligence bubble is growing louder. And, for the first time, more than half of fund managers believe in it, according to the latest survey conducted by Bank of America. Another open question is the private lending market. The bankruptcy of U.S. automotive parts manufacturer First Brands late last year triggered the collapse of two of the largest direct lending companies in that sector: Tricolor and PrimaLend."
U.S. and European stock markets sit at all-time highs and are projected to keep rising into 2026, but elevated geopolitical risks warrant caution. Early-year U.S. military intervention and alleged abduction of a head of state, plus tensions involving Venezuela, Colombia and Greenland, have increased invasion and annexation fears that unsettle investors. Concerns about an artificial intelligence bubble have intensified, with a majority of fund managers expressing belief in it. The private lending market shows fragility after First Brands' bankruptcy precipitated collapses at Tricolor and PrimaLend. Tariff legality and delayed trade impacts could further affect global markets in 2026.
Read at english.elpais.com
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