2025 is over and a frenetic 2026 of events begins, we don’t have time to write this comment and we already see Nicolás Maduro handcuffed in front of a court and Trump threatening to invade Greenland, this in the first week…
2025 has been full of events, Deepseek, Liberation Day and 2026 promises mambo… this has been the year of the dollar and gold, the big losers/winners of the year, on whose exposure the final profitability of the portfolios has depended, the SP500 has obtained a return of +16.39% but when converted to euros it has remained at a modest +2.63%. This year that leaves us we also have the ECB and the FED close to ending their cycles of rate reductions, the ECB may have already finished or has only 0.25% of additional reduction left and the FED will possibly barely lower 0.5% during 2026. But on the other hand, if they have finished the cycle of contraction of their balance sheets and we can see new Quantitative Easing operations throughout 2026 that if we join them to the strong infrastructure investment plans in the US and Europe, we find a combination of strong expansionary Fiscal and Monetary Policies, which can give a strong boost to the economy, this can be one of the positive stories of 2026, as potential risks a rebound in inflation and geopolitics can cool the existing optimism.
2026 will also be the year of AI, we will have more data to see the viability of the strong investments made by the magnificent 7 and where AI must begin to demonstrate its effectiveness in the real economy beyond the large technology companies.
At the political level, the midterm elections in the US will be held in November, the Trump administration risks losing control of the House and Senate, which would give it a more complicated second part of the mandate when it comes to applying its policies and would increase the risk that the Republicans would lose the presidency in 2028 (in theory Mr. Trump cannot run, although seeing what we are seeing…) Traditionally, the years leading up to elections are usually good as administrations try to materialize good results. news to earn, and these are earned with a good economic performance. Remember the motto of Bill Clinton’s candidacy for his first election: “It is the economy, stupid!”, where he defeated a victorious George Bush (sr.) in the first Gulf War or a heroine Margaret Thatcher in the Falklands War, but internal economic problems laid the carpet for him.
In short, 2026 is presented with a still strong economy and with favorable monetary policies, but in an ocean of unexpected events that can combine good with unforeseen bad news that will need to be monitored very closely, but at the same time have clear long-term perspectives. Our main story for this year is that companies are going to continue improving their business profits beyond the magnificent 7, after a few years of recession disguised by the profits of the big technology companies, we hope that Europe does not disappoint us and that mainly Germany implements the large investments in infrastructure announced and they are reflected in Europe growing again in business results.