Investment Officer Netherlands

Europe’s banks are heading into 2026 with solid balance sheets, but with less room for error. After an unusually long credit cycle, risks are building just as the economic environment becomes more uncertain, according to Scope Ratings’ European Bank Outlook 2026.

Around one-third of asset managers active in Europe expect a comeback for European equities in 2026. They consider stocks from the region to be inexpensive and expect the planned large-scale European government investments in areas such as defense and infrastructure to act as a catalyst.

Volatile prices make the coffee market an attractive arena for trading. However, downside risks currently dominate, experts warn.

Last week, China’s trade surplus crossed the threshold of one thousand billion dollar for the first time. In the first eleven months of 2025 alone, China exported one trillion dollar more than it imported. It is a milestone that both illustrates the export strength of Chinese industry and exposes the deep problems in China’s growth model, while further fueling calls for protectionism in the rest of the world.

Are bonds issued by well-known champion companies as safe as government debt? More and more investors seem to think so, judging by the small yield differentials between, for example, Microsoft and US government paper or between AXA and French government bonds.

Stay away next year from “long” government bonds and from corporate bonds, both high yield and investment grade. Profligate governments and poor risk-return profiles will spoil the mood in those markets.

Market sentiment in fixed income is turning quickly. Within just a few weeks, investors and even central bankers have rotated one hundred eighty degrees. Rising inflation risk and an even greater lack of fiscal discipline are pushing yields higher. It is a nightmare scenario for politicians and the run-up to a major confrontation.

Prudent risk management is vital in high-yield-bond investing. As this week’s Morningstar fund comparison shows, even strategies operating in the same corner of the market can diverge sharply when stress hits.

India is drawing fresh interest from global investors as domestic demand, rapid digitalization and a deepening capital market give it resilience few major economies can match. Emerging market specialists say these qualities are becoming increasingly relevant for diversified portfolios.

European regulator Esma is advocating a revision of research rules, expected to take effect next year. Allowing research and trade execution to be paid for jointly again could create new opportunities for smallcap coverage.