US-headquartered asset manager Allspring released its 2026 outlook this week, sharing its insights on the macroeconomic outlook and asset allocation.

Although the year ahead will have its challenges, Matthias Scheiber, senior portfolio manager and head of multi-assets at Allspring, believes that global growth will continue. The firm highlighted investment opportunities in profitable US small- and mid-cap equities and emerging markets.

“As the effects of lower interest rates make their way through the US economy in 2026, growth should gradually recover,” Schieber said. “With lower mortgage rates and robust real earnings, a growth rate of 2–3 per cent should be achievable. However, given uncertainty around the impacts of US fiscal, tariff, and immigration policies on profit margins, it’s probable that companies will save and hire carefully and consumers will remain cautious amid a slowing job market.”

Outside the US, Schieber expects growth to trend slightly higher given a robust labor market, better tariff deals negotiated, and more fiscal spending for defense and infrastructure. “Germany in particular has set ambitious plans. China should provide more fiscal and monetary stimulus to support cautious consumers and cushion the negative impact of slowing exports to the US,” he said.

Equities
“The past year was marked by the resilience of equity markets in the face of heightened policy and geopolitical uncertainty,” Ann Miletti, head of equity investments, chief diversity officer, said.

Despite volatility triggered by tariffs, elections, and shifting monetary policy, companies adapted swiftly. Although market breadth did improve, performance was heavily concentrated at the extremes. “Large-cap names tied closely to artificial intelligence (AI) surged, while small-cap non-earners rallied as the 10-year Treasury yield declined and financial conditions eased,” she continued. Looking ahead to 2026, headline index valuations remain elevated, but beneath the surface she sees compelling opportunities that have room to move.

Three areas stand out in particular:
1) Sector opportunities, as capital spending and new depreciation incentives support broader adoption of AI across industries such as healthcare, manufacturing, transportation, and financial services. Technology infrastructure providers have been the main beneficiaries of AI adoption. In the year ahead, Miletti anticipates broader implementation across industries such as healthcare, manufacturing, transportation, and financial services.

2) Profitable US small- and mid-cap equities, which offer relative value and are positioned to benefit from lower interest rates and renewed merger and acquisition activity.

3) Emerging markets, which remain meaningfully under-owned and undervalued relative to their weight in the global economy.

Miletti said that emerging markets present a compelling opportunity set. “As the backbone of the global hardware build-out, they will likely continue to benefit from productivity gains across industries as AI adoption spreads. In addition, sovereign credit ratings are now at their highest levels in more than 30 years, reinforcing improved fundamentals alongside supportive drivers such as a relatively weak US dollar, attractive valuations, and lighter positioning,” she said.

Policy support in China continues to create tactical entry points, though near-term uncertainty remains elevated. Brazil and India both showed solid momentum and policy steadiness in recent months, and Miletti expects these trends to carry into 2026. “More broadly, demographic advantages across several emerging market economies should provide a structural underpinning for long-term growth,” she said.

Paris-headquartered ABN AMRO Investment Solutions, the asset management arm of ABN AMRO, is also overweight in US and emerging market equities, notably tech. See here.

A number of wealth managers have come out recently in favor of emerging markets this year, for instance Pictet Asset Management, Ninety One, Aberdeen Investments, Paris-based Amundi, Carmignac and Indosuez, as well as GIB Asset Management and Franklin Templeton. See more here.

Fixed income
“Fixed income investors face a challenging mix of slowing growth, persistent inflation, and shifting policy,” George Bory, chief investment strategist, fixed income, said. “Global economies remain resilient, although momentum is decelerating. Inflation is easing but not yet back to target. Central banks are leaning toward accommodation, yet they remain cautious about moving too quickly.”

Against this backdrop, Bory believes that bonds continue to offer real value. Nominal yields are high by historical standards; real yields remain firmly positive; and, looking ahead, he expects income generation to be the primary driver of total returns.

The key, in his opinion, will be capturing that income while managing duration and preparing for risks that lie ahead.

While broad dislocations are limited, certain sectors stand out to him:

-- Investment-grade corporates: Credit fundamentals are sound, supported by profitability and balance sheet strength. Spreads are very tight, though – leaving more value for investors in absolute yields rather than in spreads.

-- High yield corporates: Shorter-duration, higher-quality, higher-yielding credits (BBB to B) continue to offer attractive yields, particularly in the one- to three- year range. Selectivity is critical, as defaults could increase in public and private credit markets.

-- Structured products: Certain asset-backed securities (ABS), particularly in more esoteric segments, may provide diversification and competitive yields.

-- Global government bonds: Bonds from developed markets such as the UK, France, and Japan – when swapped into US dollars – may deliver AA-level yields at spreads comparable with BBB corporates.

-- Municipal bonds: US municipal bonds may offer some of the best relative value. Taxable municipal bonds often yield on par with BBB corporates but could carry stronger credit profiles, while tax-exempt municipal bonds look especially attractive for high-tax investors.