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As AI rally matures, investors may seek value in 2026
According to analysts, global investors will actively look for opportunities in the financial markets this year that are undervalued as concerns about an AI bubble encourage traders to look past highly valued technology companies. U.S. stock prices were volatile in 2025. They plunged to bear market territory after President Donald Trump's tariffs in April before eventually rebounding to new record highs. Analysts expect the upward trend to continue into 2026. However, investors may need to be selective in their asset selection. BlackRock Investment Institute strategists said that the current environment is ripe for investing actively. The dollar fell on the expectation of Federal Reserve interest rate cuts, boosting emerging market assets. Strategists bet on other asset classes gaining traction in 2018. Small Cap Stocks As earnings prospects improve, and borrowing costs decline, U.S. Small Caps may be back in the spotlight after years of being out of the spotlight. Oren Shiran is a portfolio manager at Lazard Asset Management. He said, "The biggest difference in 2026 will be that earnings growth returns to small-cap stocks." LSEG estimates that traders expect the U.S. Central bank to cut interest rates by 25 basis points twice in 2026. Small-cap companies are more likely to have higher debt levels, and so they will be among the first ones to benefit from a decrease in interest rates. Steven DeSanctis, equity strategist at Jefferies, expects the Russell 2000 index (which tracks small-cap stocks) to reach 2,825 by 2026. This would be a gain of nearly 14% from 2025. Gold's historical run in 2025 was the best year since 1979, when the oil crisis began. J.P. Morgan and Bank of America predicted gold prices would hit $5,000 per ounce in this year compared to $4,314.12 by 2025. Wells Fargo Investment Institute analysts expect that favorable conditions will continue, but they said gains may come at a slower pace. Central banks could also provide support by purchasing assets other than dollars. HEALTHCARE & FINANCIALS A wave of policy improvements could propel the healthcare sector to be a standout. Morgan Stanley stated that the increasing reach of weight loss drugs could boost industry. As M&A accelerates and the loan growth rebounds, financials, notably?banks are expected to also outperform. Morgan Stanley stated that the sector's valuation is still attractive due to deregulation and AI driven efficiency gains. Mid-cap banks offer compelling early-cycle opportunity. CURRENCIES Analysts?said that the U.S. dollar is set for another bout in weakness in 2026 as they expect the Fed to lower interest rates to cushion an easing labor market. Analysts also see political uncertainty, such as the appointment of a Fed chair, adding to volatility. Selling would make emerging market currencies like the yuan of China and real of Brazil more attractive, as currency movements are increasingly driven by divergent policy paths. ING economists believe that the Czech crown may benefit from a new boost due to the rate increases by the Czech National Bank. Analysts at MUFG wrote that commodity-linked currencies, such as the Australian and New Zealand dollars, could also benefit from a better global growth outlook. MUFG stated that the euro, among G7 peers, is likely to be supported by fiscal stimulus, while the Japanese yen may remain vulnerable but recover in the short term. Emerging Markets A weaker dollar and relatively low valuations are expected to continue to drive?inflows into emerging markets. BofA Global strategists said that emerging markets are now less volatile than developed ones. It is a mistake to focus too much on the fact the growth of emerging markets is lower than in the "good old days". It's true. But macro stability indicators have improved in recent years. Domestic politics could cause a snag, particularly as Brazil and Colombia prepare for elections. High-Yield and Corporate Bonds According to analysts, the high-yield bond market and corporate bond markets will be active in 2026 as dealmaking will increase demand for "buyout financing" and AI heavyweights are likely to continue seeking capital to fund data center investments. According to PitchBook, as of mid-December 2025 the high-yield issuers had a total of $325 billion. This is 17% higher than in 2024, and the highest showing since 2021's pandemic record. "We have a?constructive view on high-yield bonds in 2026." In the last year, demand for high-yield bonds was strong. This allowed them to comfortably absorb a high-supply?year," wrote Janus Henderson's portfolio managers in a recent note. EVENT CONTRACTS SUPERCYCLE Retail investor demand is expected to fuel the rapid growth of event contracts. These contracts allow users to wager on real-world outcomes in politics, sports, and financial markets. These contracts became popular before the 2024 U.S. Presidential election and have prompted a new wave of startups to launch event contracts. Vlad Tenev, CEO of Robinhood, said at a recent conference that "we're still in the beginning stages of this supercycle" for this asset class. Robinhood is one of the largest players in this industry, and Coinbase also wants to get a foothold. Citizens Financial analysts estimated that prediction markets generate nearly $2 billion a year in revenue. This could increase five-fold by the time institutions begin to participate. State regulators are examining the rapid growth of these contracts, accusing them of being similar to sports betting, and encouraging potentially speculative behaviour.
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Trump threatens military action against Colombia after Venezuela raid
U.S. president Donald Trump threatened military action against Colombia's government on Sunday, telling reporters such an operation "sounds great to me". Bogota was furious. The remarks came after the United States captured Venezuelan president Nicolas Maduro during a raid early on Saturday morning and whisked to New York?to face charges of drug-trafficking. Trump said to reporters on Air Force One that Colombia was also sick. It is run by a "sick" man who enjoys selling cocaine to the United States. He will not be doing this for long. When asked directly if the U.S. was going to pursue a military campaign against?the nation, Trump replied: "It sounded good to me." Colombia has rejected Trump's remarks as an unacceptable attack on an elected leader. The Foreign Ministry issued a statement on Sunday night that said, "It is an undue intrusion into the internal affairs of the nation against international law." Reporting by Gram Slattery, Trevor Hunnicutt and Christian Schmollinger; Editing by Tom Hogue and Gareth Jones
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Chevron and US refiners' stocks surge after Trump's move towards Venezuela oil
Investors bet on President Donald Trump's decision to take action against Venezuela's government, believing that it would give American companies greater access the world's largest oil reserve. Shares of Chevron - the only U.S.'major' currently operating in Venezuelan oil fields - climbed 7.3%. Meanwhile, refiners Phillips 66 and Marathon Petroleum, Valero Energy, PBF Energy, and Valero Energy all saw gains between 5% to 16%. After President Nicolas Maduro was arrested, Trump stated that the U.S. required "total" access to Venezuela's vast reserves of oil. This heightened expectations in Washington regarding the possibility of easing restrictions on Venezuelan crude exports. Trump stated on Saturday that he would have the largest oil companies in the world spend billions to fix infrastructure and oil infrastructure which are badly damaged. In the 1970s Venezuela produced as much as 3.5 millions?barrels of oil per day, which was more than 7% global output. After years of sanctions and underinvestment, production fell below 2 million barrels per day in the 2010s. Last year, it averaged around 1.1 million barrels per day, or about 1% of global supplies. Venezuelan crude oil is a heavy sour, with a high sulfur content. It can be used to produce diesel and heavier fuels. However, the margins are lower than other grades, especially those from the Middle East. Ahmad Assiri is a research strategist for Pepperstone. He said, "This type crude oil aligns well with the configuration of U.S. Gulf Coast refining plants which have historically been designed to process this grade." Chevron is already present in Venezuela, under a U.S. waiver. This has allowed it to be a beneficiary of any shifts in policy. Refiners will also benefit from the increased availability of heavy oil closer to their home. Analysts cautioned, however, that a meaningful recovery of Venezuelan oil production will likely take some time due to political uncertainty, infrastructure decay, and years underinvestment. (Reporting by Arunima Kumar in Bengaluru; Editing by Maju Samuel)
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Oil prices fall as a well-supplied market ignores Venezuelan upheaval
Oil prices fell on Monday, as global supplies were plentiful and offset concerns about the impact of U.S. capture President Nicolas Maduro in Venezuela, the country with the largest global oil reserves. Brent crude futures fell 23 cents or 0.4% to $60.52 a barrel at 0940 GMT. U.S. West Texas Intermediate was 21 cents or 0.4% lower at $57.11 a 'barrel. Investors reacted to the Venezuela situation, an OPEC country whose crude exports have been subject to a U.S. ban, and assessed its potential impact on the oil supply. Donald Trump, the U.S. president, said that Washington would take over the country after Maduro's arrest in a New York jail on Sunday. He also stated that the embargo was still in effect. Analysts said that in a market with abundant oil supplies, any further disruption to Venezuela's exports will have little immediate effect on prices. The oil production in Venezuela has dropped in recent decades due to mismanagement, a lack in foreign investment and the nationalisation of the oil industry in Venezuela in 2000. The average output was 1.1 million barrels per day (bpd) last year. This is just 1% global production. Kazuhiko Fuku, a consulting fellow with Japan's Research Institute of Economy, Trade and Industry, said that U.S. strike action had not affected the South American nation's oil industry. Fuji stated that "even if Venezuelan imports were temporarily interrupted, more than 80% of them would still be going to China, who has accumulated ample reserves." Venezuela's acting President offered to work with the U.S. on Sunday. SEB analysts said that this would reduce the risk of an extended embargo against Venezuelan oil exports, as oil could flow freely out from Venezuela within a short time. Trump suggested that Mexico and Colombia could also face military action for not reducing the flow of illegal drugs. Analysts also watch Iran's retaliation after Trump threatened to intervene on Friday in a crackdown of protests in the OPEC-producing country. The Organization of the Petroleum Exporting Countries (OPEC) and its allies also decided to keep their production on Sunday.
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Conflict between the US and Venezuela has pushed safe-haven gold to a one-week-high.
Gold prices surged to a?more? than 2% gain and an all-time high of one week on Monday as the?geopolitical?turmoil sparked by the U.S. arrest of Venezuelan president Nicolas Maduro caused a flight for safety. Gold spot rose 2.4%, to $4433.29 per ounce at 0942 GMT. This is its highest level since December 29. It had previously reached a record of $4,549.71 an ounce on December 26. U.S. Gold Futures for February Delivery gained 2.6%, to $4443.70?an ounce. The escalation between the U.S. and Venezuela over the weekend has benefited gold. The escalation has boosted demand for "the safe-haven metal" as it increases the uncertainty that market participants already face, said Zain Vawda. Analyst at MarketPulse. Donald Trump, the U.S. president, told reporters that he would order another strike against Venezuela if it did not 'cooperate with U.S. efforts' to open its oil industry and stop drug trafficking. He also suggested that Mexico and Colombia could be subject to military action if the do not reduce illicit drug flow. Vawda said that the immediate remarks made by the Trump administration about Mexico following the Venezuela operation have left market participants wondering what future operations will be in Latin America. This should keep demand for gold high in the near-term. Bullion rose by 64% in 2013, the largest annual increase since 1979, driven by Federal Reserve rate reductions, geopolitical tensions, central bank purchases and increasing holdings of exchange-traded fund. The markets will be looking for "further clues" on the central bank's monetary policy in this year, from Friday's non-farm payrolls. Investors expect that the U.S. will cut interest rates at least twice this year. Spot silver, another precious metal, rose 4.9% to $75.18 an ounce from a record high of $83.62 per ounce on December 29. Silver prices jumped by 147% in the last year, mainly due to its status as a critical mineral for the United States, persistent supply shortages, and increasing investor and industrial demand. Spot platinum rose 3.5%, to $2,218.50 per ounce. It had reached a record of $2,478.50 on Monday. Palladium rose by 2.1%, to $1,672.93.
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BlueScope Steel receives $8.8 billion offer from SGH and Steel Dynamics
BlueScope Steel, an Australian steelmaker, said Monday that it received a preliminary?takeover bid in December from a consortium consisting of SGH?and U.S. based Steel Dynamics. The offer valued the steelmaker at $8.78 billion (?A$13.15?billion). SGH Ltd, a Sydney-listed industrial conglomerate and Steel Dynamics, a Nasdaq listed company, made a cash offer of A$30 per share on December 12. This represents a premium over BlueScope’s closing price on December 11 and a premium exceeding 22.7% above its Monday close. SGH, owned by Australian billionaire Kerry Stokes, would acquire all?BlueScope shares and sell its North American business to Steel Dynamics. BlueScope’s board is evaluating and considering the latest takeover offer, the steelmaker stated in an Exchange filing Late on Monday SGH and Steel Dynamics didn't immediately respond to requests for comment. AustralianSuper, Australia's largest pension fund, and BlueScope, its biggest shareholder, with a 12.5% stake, did not reply outside of business hours. BlueScope revealed that it had rejected three unsolicited takeover offers, including two in the late 2024 period from a Steel Dynamics-led consortium. The Steel Dynamics consortium?had initially offered A$27.50 per share and then A$29.00 in late 2024. Both proposals would have led to Steel Dynamics owning BlueScope North American businesses. Steel Dynamics' third proposal, made in early 2025, would have acquired BlueScope and retained its North American operations. The remaining assets were then distributed to BlueScope's shareholders. The North American operations were valued at A$24 per share and the other assets at A$9 per share. The report said that "these?approaches" were rejected because they undervalued BlueScope's future prospects and presented significant execution risks in relation to regulatory outcomes.
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After the Venezuelan shock, European stocks reach record highs led by defense shares
Investors piled into stocks in the defence industry on Monday after U.S. strikes on Venezuela prompted fresh geopolitical worries. After a holiday hiatus, the advance highlights expectations for structurally higher defense expenditures despite recent weakness in stocks of the sector driven by speculation about a possible ceasefire between Russia Ukraine. The pan-European STOXX 600 rose as much as 0.6% to 599.65. This is a new record high. The defense index rose by 3.3%, reaching its highest level for nearly three months. The technology and basic resources sectors also grew by 2.3% and 2.0% respectively. The German stock index also reached a record high. It was up 1% at the end of last year, and defense manufacturer Rheinmetall led with a gain of 7%. The European energy index fell 0.2% due to lower oil prices. Global supplies are sufficient, reducing concerns over disruptions caused by the U.S. attack on Venezuela. capture President Nicolas Maduro. "Venezuelan oil supply is unlikely to have a significant impact on global energy markets in the near future." Even with optimistic assumptions, it would take years to restore the country's oil sector, said Landon Derentz. He is vice president for energy and infrastructure of Atlantic Council Global Energy Center. Investors continue to monitor the fallout of the strikes. On Saturday, President Donald Trump announced that he would temporarily place Venezuela under American control. A RATE CUT IN THE SPOTLIGHT Investors also focus on central banks. They watch incoming data to get clues about how quickly rates could be cut. Goldman Sachs stated that it expects 2026 to be an improved year for the Euro Area economy than 2025, given prospects for cyclical improvements. "Further interest rate cuts are possible, but they would need a clear catalyst to do so. This could be a material decline in activity or an inflation that is lower than expected." Glencore, Rio Tinto, and Anglo American?also benefited from the higher copper price. ASML shares, the largest supplier of computer chips in the world, increased by 3.2%. Analysts at brokerage Bernstein upgraded their stock from "market perform" to "outperform", and increased the price target to 1,300 euros, from 800 euros. (Reporting and editing by Mrigank Dahniwala, Ronojoy Mazumdar and Niket Nishant from Bengaluru)
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Investors assess Venezuela's upheaval by assessing the oil price, stocks and bonds.
On Monday, oil prices fell and bonds yields increased as investors assessed the possible repercussions from the U.S. Capture of Venezuelan president Nicolas Maduro. STOXX, a benchmark index for Europe's largest companies, rose 0.5%. MSCI's broadest Asia-Pacific share index outside Japan climbed 1.3% to a new record high. U.S. Futures like S&P 500 e-minis also gained 0.2% before a week packed with economic data. U.S. president Donald Trump announced that after the events of the weekend in Venezuela, he would temporarily take control of the South American country. He also said that he might order another strike "if Venezuela doesn't cooperate" with U.S. efforts for it to open its oil industry and end drug trafficking. He also threatened to take'military action' in Colombia and Mexico. Neil Shearing, Capital Economics, said that the removal of Venezuelan president Nicolas Maduro from office by the U.S. would not have any significant economic effects on the global economy in the near future. But its geopolitical and political ramifications are sure to reverberate. The oil prices fluctuated as the OPEC+ decision to maintain output remained unchanged was countered by concerns about market disruptions due to events in Venezuela, which produces oil. Brent crude futures last fell 0.8% at $60.26 per barrel. After the U.S. strikes on Syria, new concerns about geopolitical risk sparked by the U.S. military strike, defence stocks led to?gains' in Europe. The index of defense shares rose by 2.7%, reaching its highest level in two months. Vasu Menon, OCBC Singapore, said: "Given that the Venezuelan events over the weekend were unexpected, it is yet to be seen if the Trump administration wants more regime changes." "Strategic calculations are taking place against a backdrop of mid-term elections, and the developments are unpredictable." This uncertainty may keep oil prices high. "A more volatile geopolitical climate may boost haven assets such as precious metals." US MILITARY MEASURES IMPLEMENT SAFE-HAVEN REQUEST Gold prices rose on Monday, with spot price up 2.33% to $4,430 per ounce. However, they are still below the record high set last year of $4,549.71. The yield on Germany's 10-year Bund, the benchmark for the eurozone, was also essentially unchanged at 2.893%. It had risen by 3 basis points in the previous week. The yield on U.S. 10 year?Treasury Bonds held steady at 4,173%. The U.S. Dollar Index, which measures dollar strength against six different currencies, rose 0.13% to 98.685 at the end of last day, extending recent gains for a sixth straight day. The dollar was unchanged against the yen at 156.79yen. Kazuo Ueda, Governor of the Bank of Japan, said that after increasing rates by 25 basis points last month to 0.75%, they will continue to do so if economic and prices developments are in line with their forecast. Bitcoin rose 1.2% to $92,327.40. Ether was up 0.4% to $3,154.62. (Reporting and editing by David Gooding, Gregor Stuart Hunter, and Lawrence White)
Barrick will resume its operations in Mali as soon as it can ship gold to the country, Barrick's CEO said
Mark Bristow, CEO of Barrick Gold, said that the mine will resume operation once Mali authorities allow it to resume gold shipment.
Bristow, a Canadian miner, told Toronto that Mali had assured it that the gold worth $245 million confiscated by authorities belonged to Barrick. Mali and Barrick are locked in a dispute over Mali's new mining codes since last October.
On Wednesday morning, the Toronto Stock Exchange saw the miner's share price rise as high as 6%.
Barrick is Mali's largest investor. The tensions between the two parties increased when Mali arrested four Barrick employees, issued an arrest warrant to Bristow and earlier this month seized gold from Barrick’s mine.
Bristow added that Barrick had paid $460 Million to the Mali Government last year.
"So, if you do the math per week... every week that we don't follow through on this hurts us all," he said.
Barrick also filed a dispute resolution arbitration with the International Arbitration Commission against Mali.
Bristow stated that Mali is not a project for a short time and the company plans to remain invested in the country.
(source: Reuters)