According to reports from CNBC TV18, Goldman Sachs maintains a positive outlook on Asian equities despite the region's strong performance in the first half of the year. The investment bank believes Asian stocks still have room to run even after experiencing a blistering first-half rally. This assessment suggests that the current momentum in Asian markets may continue beyond the recent strong performance period. In its latest second-half Asia equity outlook, Goldman Sachs urges investors to 'stick with the winners,' arguing that earnings growth, rather than valuations, remains the dominant driver of markets.
As reported by CNBC TV18, Goldman Sachs recommends that investors should continue diversifying into commodities as part of their investment strategy. The bank's rationale centers on geopolitical shocks that are reinforcing long-term demand for metals and energy infrastructure. Following months of disruption in the Strait of Hormuz, Goldman Sachs said investors should continue diversifying into commodities even as oil prices retreat after the reopening of the shipping route. The bank expects demand growth in copper to continue outpacing mine supply for years as investment in electricity networks, renewable energy, electric vehicles, defense and data centers accelerates. It recently lifted its end-2026 London Metal Exchange copper forecast to $13,735 a metric ton and maintained that prices may need to reach around $15,000 by 2035 to incentivize sufficient new supply.
According to CNBC TV18, Goldman Sachs advocates for a dual approach to investment strategy in the current market environment. The bank suggests maintaining exposure to Asian winners while simultaneously expanding into commodity investments. In its second-half Asia equity outlook, Goldman Sachs retained an overweight recommendation on North Asia, favoring South Korea, Taiwan, Japan and China's domestic A-share market, alongside technology hardware, capital goods and banks. The bank highlighted that the semiconductor memory supercycle is one of the most powerful and prominent themes that is still not fully priced. Goldman Sachs expects the MSCI Asia Pacific ex-Japan Index to deliver mid-teen returns in the second half, supported by projected earnings growth of 60% in 2026 and 22% in 2027.
As reported by CNBC TV18, Goldman Sachs noted that close to 80% of year-to-date regional market performance can be explained by earnings growth or revisions to earnings growth forecasts. The bank emphasized that markets are 'trading earnings to a greater extent than before.' Rather than rotating into lagging sectors after technology's outsized gains this year, Goldman Sachs argued investors should remain focused on structural winners including AI infrastructure, power generation, defense, capital-intensive industries and selected China themes. These same themes also underpin the bank's latest commodity outlook, with the growing emphasis on energy security, artificial intelligence infrastructure, electrification and higher defense spending continuing to bolster demand for industrial metals including copper, lithium and aluminum.
