Bloomberg Surveillance Markets Eye Tech Turnaround
Dec 22, 2025
In this discussion, David Kelly, Chief Global Strategist at JPMorgan Asset Management, analyzes the K-shaped recovery and its implications for the economy in 2026. George Bory, Chief Investment Strategist at Allspring Global Investments, emphasizes the need for bond portfolio diversification amid diverging central bank policies. Michael Purves, CEO of Tallbacken Capital Advisors, forecasts increased M&A activity driven by competitive pressures in the AI landscape, alongside concerns about the limits of equity growth despite favorable market conditions.
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Market Strength From Institutional Flows
- Institutional flows and tax frictions are funneling money into equities despite a mediocre economy.
- That creates a strong market even when underlying growth is only moderate.
Rebalance To Manage Elevated Risk
- Rebalance portfolios to reflect elevated valuation and risk levels.
- Reduce concentrated exposure and seek tax-efficient ways to add balance for 2026.
Shrinking Labor Force Slows Growth
- The labor force is effectively shrinking and that constrains job creation and growth.
- Fewer workers reduce supply and therefore slow the broader economy via lost demand and activity.