Experts See Bright Stock Market Ahead for Second Half of 2026

Experts anticipate a bright future for the stock market in the latter half of 2026, even amidst continued geopolitical tensions and fluctuating oil prices. Molly Guggenheimer, a strategist at Danske Bank, suggests the market could exceed expectations, noting that the tech-heavy global market's volatility is likely to subside.

Guggenheimer explains that the market has already adjusted for future possibilities in AI and software stocks, effectively pricing in high expectations. This has reduced the risk associated with the global market. She dismisses concerns about an AI bubble, stating the current upswing is driven by profits rather than valuations. The primary risk, she notes, is not a bubble burst but a potential decrease in demand that could impact profit margins for semiconductor companies.

While regions like the U.S. and Asia show strong profit growth, their heavy reliance on technology makes them volatile. Guggenheimer points to the Stockholm stock exchange as a compelling alternative, with its minimal AI exposure offering reduced volatility. The exchange has already seen a nearly 10% increase in the first half of 2026, with potential for further growth.

Looking ahead, Guggenheimer predicts that cyclical companies, such as industrial firms, will benefit from an economic shift. Sectors sensitive to interest rates but not economic cycles, like medical technology, are also worth watching. Conversely, defensive sectors like healthcare and consumer staples are expected to underperform. Tobias Tallberg of Handelsbanken Fonder adds that Swedish small-cap stocks may see a comeback due to attractive valuations compared to larger, overvalued companies with less profit growth.