Goldman Sachs Client Survey: What is the outlook for assets in 2026?

Goldman Sachs' latest survey covering over 900 clients shows that investors are looking at the asset outlook for 2026 with a differentiated and complex perspective.

Overall, market sentiment is dominated by several core themes: a sustained but increasingly cautious optimism towards AI-driven tech stocks, a heightened focus on the Federal Reserve's interest rate cut path, and a continued preference for safe-haven assets like gold amid macroeconomic uncertainty.

Conducted with only 20 trading days left in 2025, this survey reveals the latest dynamics among investors in key asset classes. Among the most striking trends is that, despite a recent market rotation from tech stocks to defensive sectors, the technology and media telecommunications (TMT) sector remains the most favored area by investors for 2026. Meanwhile, a slowdown in AI development is seen as the biggest risk facing the stock market, highlighting the core position of this technology in current market pricing.

On a macro level, the market generally expects the Federal Reserve to initiate a rate cut cycle in the first half of 2026, but there are differences regarding the specific timing and magnitude of the cuts, with some investors believing that current expectations may be overly optimistic. Notably, there has been a subtle shift in investors' views on the U.S. dollar, with slightly more bullish than bearish sentiment. This expectation combination could break long-standing market patterns and have profound implications for global asset allocation.

In the credit loan market, AI is not only a risk topic but also signifies huge financing demand, with over half of respondents expecting a substantial scale of related bond issuance.

In terms of commodities, market sentiment shows clear differentiation. Investors remain bullish on gold, primarily driven by central bank purchases and fiscal concerns; however, the outlook for oil is generally pessimistic. These survey results collectively outline a panoramic view across asset classes, reflecting that amid a global economic and policy transition period, investors are trying to find a balance between opportunities and risks.

Stock Market: Tech Stocks Remain the Preferred Choice, AI Slowdown as the Biggest Risk

The survey shows that despite ongoing discussions about the "uncertainty" in the tech and AI sectors, investors still have confidence in the long-term narrative of tech stocks. Among all sectors, TMT is the most favored investment direction for 2026, while the consumer sector is the least favored.

Brian Garrett, co-head of Goldman Sachs' equity execution team, pointed out: "Interestingly, we have seen funds rotating from tech stocks to defensive sectors, but tech stocks remain the most favored sector for 2026. This indicates that investors still believe in the tech story." However, this optimism is not without conditions. The slowdown in AI development is viewed as the biggest potential risk, followed by concerns about deteriorating economic growth.

Interest Rates: Expectation of Two Rate Cuts, but Hawkish Risks Remain

In the interest rate market, investors expect the Federal Reserve to cut rates twice in the first half of 2026. Specifically, 34% of respondents believe that by the end of 2026, the federal funds rate will be in the range of 3% to 3.25%

However, Derek Kump from Goldman Sachs' interest rate products sales department cautions that this expectation may be overly optimistic. He stated that considering the recent hawkish comments from Federal Reserve officials (such as next year's voting members Hammack and Logan), as well as the strong first-quarter GDP data that may arise from the economic rebound following the end of the government shutdown, the likelihood of two rate cuts in the first half of the year seems to have decreased.

Kump added, "Given the recent hawkish comments from the Federal Reserve, the expectation that rates will reach 3-3.25% by December 2026 feels quite optimistic." He even suggested that if the Federal Reserve does cut rates next month, it is likely to be a "hawkish cut," meaning that while rates are being cut, the dot plot for the 2026 rate forecast may actually be adjusted upward.

Forex: Dollar Movement Focused on Rate Cuts, Historical Patterns May Be Broken

More than half of investors believe that the Federal Reserve's rate cut cycle will be the biggest driver of the dollar's movement in 2026. Compared to other times this year, there has been a subtle shift in investor positioning, with slightly more people bullish on the dollar than bearish.

Daniel Dooling, head of foreign exchange hedge fund sales for Goldman Sachs in Europe, the Middle East, and Africa, observed a significant shift in expectations, with more people anticipating that the dollar index (DXY) will decline during a major correction in the S&P 500 index. He explained, "This contradicts long-standing historical patterns and theories, which suggest that during extreme volatility, the 'dollar smile' theory will take effect (i.e., the dollar strengthens in both risk-off and strong U.S. economic scenarios)." Additionally, investors expect Latin American currencies to continue performing strongly, while the yen has room to reverse its downward trend.

Credit Loans: Significant Issuance Scale Related to AI, Market Enthusiasm Moderating

In the credit loan market, the AI theme is also at the center of attention, but the focus is more on the issuance aspect. More than half of clients expect that AI-related bond issuance in 2026 will be between $500 billion and $1 trillion. As many as 70% of respondents expect the issuance scale to exceed $500 billion.

However, Karl Blunden from Goldman Sachs' fundamental strategy team pointed out that despite the high expectations for issuance, market enthusiasm for AI concept stocks seems to be cooling. Only 15% of respondents expect investor enthusiasm for AI concept stocks to further increase. Overall, investors expect the performance of U.S. high-yield bonds (HY) and investment-grade bonds (IG) to moderate, with the consumer/retail sector within high-yield bonds seen as a potential weak link In terms of credit risk, policy, capital outflows, and geopolitical issues are seen as the biggest risks.

Commodities: Bullish Sentiment for Gold Continues, Central Bank Purchases Become Major Driver

The sentiment in the commodities market continues the previous trend: 69% of respondents are bullish on gold, while 52% are bearish on oil.

For gold, central bank purchases and concerns about fiscal conditions are seen as the main drivers for price increases in 2026. Adam Gillard from Goldman Sachs' commodities institutional sales department stated, "Investors continue to expect that central bank purchases will be the dominant driving factor for gold prices next year, so despite recent pullbacks in gold prices, they still maintain a constructive outlook."