Standard Chartered Korea has proposed expanding allocations to U.S. and Asian (excluding Japan) stocks, as well as incorporating emerging market (EM) dollar-denominated bonds and alternative assets like gold in its investment strategy for the latter half of this year. The bank recommends investors remain flexible in response to shifts in the investment landscape driven by four key variables: energy prices, increased initial public offerings (IPOs), changes in investor positioning, and monetary policies of major central banks.
On Monday, Standard Chartered Korea released its 2026 Second Half Global Financial Market Outlook and Investment Strategy report for wealth management (WM) clients, presenting the investment theme for the latter half of the year as Navigating Shifting Sands.
The bank forecasts that a favorable environment for risk assets will persist, given the soft landing of the global economy and continued robust corporate earnings. However, it cautions that market volatility may increase, emphasizing the importance of a differentiated strategy across asset classes.
In light of this, Standard Chartered Korea’s core investment strategies for the second half of the year include: 1) increasing allocations to U.S. and Asian (excluding Japan) stocks, 2) favoring emerging market dollar-denominated bonds, and 3) diversifying portfolios through gold and alternative investments.
In the equity market, the bank identifies U.S. stocks as the most promising, projecting continued relative strength based on solid corporate profits and potential oil price stabilization. It advises investors to broaden their focus beyond semiconductors to include artificial intelligence (AI)-beneficiary sectors such as internet, software, and communication services.
The bank has also adopted a more positive stance on Asian equities. It has upgraded its investment opinion on Asian stocks (excluding Japan) to overweight, highlighting India, China, and Taiwan as attractive markets. The bank anticipates ongoing benefits from stable energy prices and the expansion of AI and semiconductor supply chains in these regions.
Bonds continue to be viewed as a reliable source of stable interest income. The bank particularly favors emerging market dollar-denominated bonds, citing their high yields and lower currency fluctuation risks compared to local currency bonds. It suggests that investments should prioritize corporate and emerging market bonds over developed country government bonds, which are more sensitive to interest rate fluctuations.
To enhance portfolio diversification, Standard Chartered Korea maintains its overweight recommendation for gold. With ongoing gold purchases by global central banks, the precious metal is expected to maintain its role as a key safe-haven asset against geopolitical risks and potential stagflation. The bank also notes that liquid alternative investments and private equity alternatives could serve as valuable tools in navigating periods of increased volatility.