HSBC's AI-driven equity outlook for 2026 (with Lisa Abramowicz, Annmarie Hordern)

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HSBC 8.0
Investment Bank $1686.00B
Alastair Pinder 8.5

HSBC's AI-driven equity outlook for 2026 (with Lisa Abramowicz, Annmarie Hordern)

ndx

AI infrastructure and enablers drove 2025; 2026 narrative is AI adoption driving earnings... Mag7 earnings growth slowing to high teens, rest of market catching up; first year since 2021 with equal earnings growth between groups. While positive on AI-driven earnings, expects broadening beyond Mag7, suggesting more moderate, cautious upside for NDX as leadership diffuses.

11/14/2025 2:18:30 PM	short term up	7 days later	+0.30%	+0.30%
10/21/2025 2:06:48 AM	short term up	5 days later	+3.79%	+3.79%
10/20/2025 11:51:24 PM	short term up	6 days later	+2.76%	+2.76%
8/19/2025 9:14:27 PM	short term up	5 days later	+0.76%	+0.76%

Asking how AI will drive markets higher given recent concerns.

Lisa Abramowicz
Alastair Pinder

AI infrastructure and enablers drove 2025; 2026 narrative is AI adoption driving earnings. 45% of companies adopting AI, potential 1% cost cuts ($130B savings).

Revenues growing while companies cut labor; S&P 500 earnings revisions near all-time highs; feels like Goldilocks scenario for equities.
Clarifying if this means rest of market (493) catches up to Mag7.

Lisa Abramowicz
Alastair Pinder

Mag7 performance driven by earnings growth, not valuations. Earnings growth for Mag7 slowing to high teens, rest of market catching up; first year since 2021 with equal earnings growth between groups.
Asking for telltale sign of significant AI adoption in industries.

Annmarie Hordern
Alastair Pinder

Already seeing it: consumer stocks using AI for targeted ads; many companies on earnings calls discussing AI adoption, replacing or freezing labor.

Productivity gains concentrated in large-cap stocks with many employees, not small companies or broader economy.
How could Fed rate cuts solve AI labor layoff problem?

Annmarie Hordern
Alastair Pinder

Fed cuts don't solve AI, but reduce pressure on labor market near term by lowering credit costs, interest rates, burden on low-income consumer.

Low-income consumer hardest hit by high rates due to floating-rate debt.
Asks if US becomes less attractive for equities due to expected stimulus and rate cuts.

Lisa Abramowicz
Alastair Pinder

Agrees; market missing global stimulus wave (China $1.4T debt swap, Germany $150B, Japan $110B). As dollar weakens, rest of world looks attractive with 30-40% valuation discount.

Prefers AI tech play in emerging markets over US due to valuation; overweight EM, Europe/Germany; neutral US.
Asks about potential tariff impact.

Annmarie Hordern
Alastair Pinder

Tariffs a major worry for 2026; inventory stocking may lead to incremental inflation, eating into margins, but AI can help offset via cost savings.

Tariffs could force faster AI adoption for productivity, similar to COVID.
Asks if lack of bearishness makes him nervous.

Lisa Abramowicz
Alastair Pinder

Investors are worried about AI bubble and labor/consumer rollover; not everyone bullish. $3.5T in cash on sidelines; as Fed cuts, cash can flow into equities.

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