Market Outlook

Key Takeaways

Geopolitical premiums have faded, downgrading the oil crisis to a tail risk. However, spreading inflation is pressuring major central banks to raise rates. The AI boom continues to boost semiconductor sectors but has also driven economic divergence, creating a "K-shaped" split in consumer confidence and employment.
China’s deflationary pressure has eased. Exports are surging—driven by high-tech and EVs—though consumer recovery remains slow. Policy focus has shifted to long-term infrastructure like the "Six Networks" to anchor the next growth cycle.
The AI sector sees both opportunities and challenges. Rapid growth in agentic AI and rising capital expenditure from hyperscalers benefit upstream industries, while accelerating cloud revenues show that AI monetization is picking up.

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