Group 1 - The core view is that by 2026, going long on commodities will be the best trading theme, with all commodity price trends expected to rise similarly to gold [2][3] - The shift in global economic policy from "monetary easing + fiscal tightening" to "fiscal easing + de-globalization" post-pandemic is a key factor driving this outlook [2][6] - The report highlights that the current environment favors commodities, particularly oil and energy, as the best contrarian investment opportunity due to anticipated economic policies and geopolitical changes [3][9] Group 2 - The report indicates that the structural opportunity for commodities arises from the paradigm shift in global economic policies, which has changed the performance dynamics between bonds and commodities [6][11] - Latin American stock markets have shown significant growth, up 56% year-to-date, indicating a broader market trend towards natural resources and metals [7][9] - Historical patterns suggest that bond markets are cautious about "hot" economic policies, with a tendency for yields to rise following the nomination of a new Federal Reserve Chair [10][13] Group 3 - The report notes that while commodities are favored, there is caution regarding the bond market, particularly with the potential for rising yields due to economic interventions and labor market weaknesses [11][17] - The stock market is experiencing a complex differentiation, with liquidity peaks corresponding to credit spread lows, indicating a shift in investment focus towards AI capital expenditures [19][21] - Specific sectors such as cyclical stocks related to "Main Street" (housing, retail, transportation) are viewed as having the best relative upside potential, driven by expected economic stimulus policies [22]

Core Viewpoint - The chief investment strategist at Bank of America, Michael Hartnett, predicts that going long on commodities will be the best trading theme by 2026, with all commodity price trends expected to rise similarly to gold. This prediction is based on a shift in global economic policy from "monetary easing + fiscal tightening" post-financial crisis to "fiscal easing + de-globalization" after the pandemic [1][5]. Group 1: Commodity Market Outlook - Hartnett emphasizes that the Trump administration's "hot" economic policies and a potential resolution to the Russia-Ukraine conflict will lead to a rebound in oil prices, driving strength in the commodities sector [2][7]. - The report highlights that natural resources, metals, and Latin American stock markets (which have risen 56% year-to-date) are breaking out, with a particular focus on the oil and energy sectors as the best contrarian investment opportunity for 2026 [2][5]. Group 2: Economic Policy Shift - The core logic of Hartnett's assessment is rooted in the transition of economic policy paradigms: the combination of excessive monetary easing and fiscal tightening post-financial crisis favored bonds, while the post-pandemic environment of excessive fiscal easing and the end of globalization will favor commodities in the 2020s [3][5]. - The report indicates that the structural opportunities for commodities arise from this shift in global economic policy, contrasting the previous decade where bonds significantly outperformed commodities [5]. Group 3: Bond Market Insights - Despite a positive outlook on commodities, Hartnett expresses caution regarding the bond market, noting that historical patterns show bond yields tend to rise following the nomination of a new Federal Reserve Chair [8][9]. - The report mentions that the Bank of America previously took a tactical long position in zero-coupon bonds, anticipating a Federal Reserve rate cut and economic interventions to lower inflation, but plans to end this position before the new chair's term begins [8][14]. Group 4: Stock Market Dynamics - Hartnett observes a complex differentiation in the stock market compared to the overall pressure in the bond market, suggesting that liquidity peaks correspond to credit spread lows [16]. - In the AI sector, the focus is on companies adopting AI technologies rather than those merely spending on it, with mid-cap stocks expected to perform well in 2026 due to potential economic interventions by the Trump administration [19]. - The report identifies cyclical sectors such as homebuilders, retail, and transportation as having the best relative upside, driven by anticipated economic stimulus policies [20].

Group 1 - The core view is that by 2026, going long on commodities will be the best trading theme, with all commodity charts expected to show upward trends similar to gold, driven by a shift in global economic policy from "monetary easing + fiscal tightening" to "fiscal easing + de-globalization" post-pandemic [1][3] - The report highlights that the combination of excessive fiscal easing and a relatively smaller degree of monetary easing after the pandemic, along with the end of globalization, will allow commodities to outperform bonds in the 2020s characterized by populism and inflationary growth [3][5] - The Latin American stock market has seen a significant increase of 56% year-to-date, indicating a broader breakout in natural resources and metals [3][5] Group 2 - Hartnett emphasizes that the oil and energy sectors, long overlooked by the market, represent the best "hot trade" contrarian investment opportunities, influenced by the economic policies of the Trump administration and geopolitical changes [5] - Historical patterns indicate that after the nomination of a new Federal Reserve Chair, bond yields typically rise, with an average increase of 65 basis points for 2-year yields and 49 basis points for 10-year yields within three months [6][9] - The current market is cautious about bonds due to the anticipated "hot" economic policies, with the potential for significant market movements concentrated in the first half of 2026 [12] Group 3 - The stock market is exhibiting a more complex and differentiated pattern compared to the overall pressure in the bond market, with liquidity peaks corresponding to credit spread lows [13] - In the AI sector, the focus is on adopters of AI technology rather than spenders, with mid-cap stocks expected to perform well in 2026 due to potential economic stimulus from the Trump administration [16] - Specific sectors such as cyclical "Main Street" industries (homebuilders, retail, paper, transportation, and REITs) are seen as having the best relative upside potential, supported by anticipated domestic economic support [16]