Corporate earnings are booming, fuelled by massive AI investments, while rising bond yields have pushed global P/E valuations down to around 18x this year’s earnings. This represents a derating of roughly 20%, even as global equity markets have gained nearly 15%. Is this sustainable?

Market leadership has been unusually narrow in 2026, with a small group of companies driving a disproportionate share of global equity returns.

The speed of change is extraordinary, with the transition to a multipolar world creating geopolitical fragmentation and the “rise of the nation state” now happening at an accelerating pace. However, the uncertainty of change can also create blind spots if you focus too much on the daily news flow rather than the long-term fundamental trajectories.

We see signs of change among international investors and a growing reassessment of how global equity portfolios are constructed. The trigger is not a single event, but a combination of geopolitical fragmentation, heavy concentration in AI-related stocks, and a continued US dominance in global indices.

We have identified four pivotal changes that point to an emerging change in market trends with investors refocusing more on fundamental and structural growth. These four changes are a revival of quality stocks, broadening out of the AI theme, the rise of China and India and the peak of US equity market capitalisation dominance.