Our multi-asset investment views – June 2026
We continue to see a low risk of recession in the United States and view the recent labour market data as consistent with our view. Our overweight position in equities has been supported by corporate earnings momentum and from a sectoral perspective, we have taken profits on our US technology exposure but maintain a positive view on Asian technology. We also maintain our exposure to energy and resource stocks but have switched from UK and Canadian equities to a purer sectoral exposure to these areas. This helps us manage the risk of more prolonged disruption in the Middle East but also reflect the strong industrial momentum that we are observing.
We have taken profits on our long position in agricultural commodities and for now, our positive bias towards commodities is expressed via equities rather than through physical commodities.
We remain neutral on rates as yield levels now reflect some of our concerns and we are less positive on Australian bonds and BTPs relative to US bonds. We are also less positive on US investment grade debt, as we don’t believe that yield levels relative to cash are attractive, given stagflationary risks and increasing issuance. We maintain our negative view on the Japanese yen position and our neutral/positive view on the US dollar.
All in all, our view on the major risks is unchanged relative to last month. We have harvested some profits and await more provocative levels to take more significant action.
🟢 Long / positive
🟡 Neutral
🔴 Short / negative
🔼 Up from last month
🔽 Down from last month
Main Asset Classes
🟢 Equities
We remain positive on equities. Earnings growth continues to support risk assets, although the cycle is becoming more mature and increasingly concentrated. To improve diversification, we have broadened exposure beyond technology through financials and resource-related sectors.
🟡 Government bonds
We remain neutral on government bonds. While higher yields have improved valuations and carry opportunities, persistent inflation risks continue to limit conviction in adding duration exposure.
🟢 Commodities
We remain positive on commodities, although our preferred exposure has shifted. Following profit-taking in agriculture and gold, our positive view is now expressed primarily via industrial metals and energy-related equities.
🔴 Corporate bonds (credit)
We remain negative on credit, particularly US investment grade, where spreads continue to offer limited compensation for inflation and duration risks. We continue to favour equities over credit given the stronger earnings backdrop.
Equities
🟢 US
Continued earnings momentum and ongoing investment in AI-related infrastructure support our positive view on US equities. While market leadership remains concentrated, earnings growth continues to underpin the outlook.
🟡🔽 UK
We have downgraded UK equities to neutral. While financials, energy and materials remain supportive sectors, we now prefer more targeted expressions of these themes elsewhere.
🟢🔼 Europe ex UK
We have upgraded to positive, reflecting increased conviction in the financial sector. Attractive valuations, resilient earnings and a higher-for-longer rate environment continue to support European banks while providing diversification away from the narrow AI theme.
🟡 Japan
Improving domestic conditions continue to provide support, but uncertainty around the pace of policy normalisation and the outlook for yields tempers our conviction. Currency volatility remains an additional consideration.
🟢 Global Emerging Markets (EM)1
Resilient earnings momentum across parts of Asia continue to support emerging markets. Technology-related sectors remain an important driver of the positive outlook.
🟢 Asia ex-Japan: China
Our positive view is focused on selected technology sectors benefiting from AI-related investment and digital adoption trends. Ongoing weakness in domestic demand and the property market continues to warrant a selective approach.
🟢 EM Asia ex China
AI-related demand across the semiconductor supply chain continues to support EM Asia. Earnings momentum remains favourable, although the increasingly mature nature of the cycle argues for greater selectivity.
1Global Emerging Markets includes Central and Eastern Europe, Latin America, and Asia.
Government bonds
🟡🔼 US
We have upgraded our view to neutral. Higher yields have improved the attractiveness of US government bonds, particularly from an income perspective. However, persistent inflation risks keep us on the sidelines for now.
🟡UK
More attractive yields are balanced by inflation uncertainty and evolving policy expectations. A neutral stance therefore remains appropriate given the mixed outlook.
🟡🔽 Europe
We have downgraded to neutral after taking profits on our Italian BTP position. Although yields remain attractive in parts of the market, inflation uncertainty and a more balanced risk-reward profile limit conviction in adding further exposure.
🟡 Japan
Rising inflation expectations and ongoing policy normalisation continue to create uncertainty around the path of yields. The balance of risks remains broadly neutral.
🟡 US inflation-linked bonds
Inflation risks remain elevated, but much of the near-term inflation backdrop appears reflected in current market pricing. Current valuations provide a more balanced risk-reward profile.
🟢 Emerging markets local currency bonds
Attractive real yields and carry opportunities continue to support local currency emerging market debt. Fundamentals remain favourable across a number of regions.
Investment grade credit
🔴 US
Spreads continue to offer limited compensation for inflation, duration and refinancing risks. Given the stronger earnings backdrop, equities remain preferable to investment grade credit.
🟡 Europe
Spread levels offer limited compensation for a more challenging growth and inflation backdrop, leaving us with a more balanced view on the asset class.
🟡Emerging markets USD
Supportive fundamentals are balanced by tighter financial conditions and geopolitical uncertainty. Current valuations warrant a more neutral stance.
High yield bonds (non-investment grade)
🔴 US
Tight spreads continue to offer limited compensation for a more uncertain inflation and growth environment. We remain negative.
🔴 Europe
Current valuations provide limited protection against potential volatility in growth and financing conditions. Credit risk remains inadequately rewarded.
Commodities
🟢🔼Energy
We have upgraded energy to positive. Tight supply conditions and ongoing inventory replenishment needs continue to support the sector, while energy-related equities provide diversification within broader portfolios.
🟡🔽Gold
We have downgraded gold to neutral. Although central-bank demand remains supportive, gold has become increasingly driven by interest-rate expectations and has provided less diversification during recent periods of geopolitical uncertainty.
🟢🔼Industrial metals
We have upgraded our view to positive. Growing demand from AI infrastructure, electrification and grid investment is being met by increasing supply constraints across several key metals, creating a more supportive backdrop for the sector.
🟡🔽 Agriculture
We have downgraded agriculture to neutral. Improved planting conditions and the absence of a meaningful demand catalyst have reduced conviction in the near-term outlook despite longer-term supply-side support.
Currencies
🟡 US $
Higher US rates and resilient economic data continue to provide support for the dollar. Broader valuation and positioning considerations, however, limit conviction.
🟡 UK £
Yield support remains balanced against a mixed domestic growth backdrop. Current conditions support a neutral assessment.
🟡 EU €
Improving sentiment towards selected European sectors is offset by a still-challenging macro environment. A balanced view remains appropriate.
🟢 CNH ¥
The renminbi remains one of our preferred ways to gain emerging market exposure. Relative stability and continued technology-related investment remain supportive.
🔴 JPY ¥
Wide interest-rate differentials continue to support a negative view on the yen versus the dollar. Although further policy normalisation by the Bank of Japan remains likely, the pace of tightening is expected to be gradual.
🟡 Swiss franc ₣
Defensive characteristics remain supportive, although low carry continues to reduce relative attractiveness. Current valuations justify a neutral stance.
Source: Schroders, May 2026. The views for equities, government bonds and commodities are based on return relative to cash in local currency. The views for corporate bonds and high yield are based on credit spreads (i.e., duration-hedged). The views for currencies are relative to the US dollar, apart from the US dollar which is relative to a trade-weighted basket
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