Q3 2026 Outlook: A Bumpy Road Ahead

The interim U.S.-Iran memorandum signed on June 17 initially eased fears of a stagflationary spiral, and equities rallied to new highs on the back of strong AI-driven earnings. But with the conflict resuming in July, the prospects of normalization of energy supply through the Strait of Hormuz remain uncertain and risk premium in energy markets is therefore likely to persist. Growth remains positive, but momentum has slowed.

A combination of tightening liquidity and stretched valuations raises the risk of a sharper pullback than markets are pricing in. In this edition, we outline our changes in the outlook for different categories of equities, fixed income and alternatives, and build the case for infrastructure as a core allocation.

We hope this Investment Outlook offers useful insights for the months ahead, and we look forward to supporting your longer-term wealth goals.