Global Equity Rotation Without a Bear Market

Pictet’s March outlook argues that the global equity rally remains intact even as leadership rotates away from U.S. technology stocks. 

• Strong global growth, falling interest rates, fiscal stimulus, and heavy AI-related capital expenditure continue to support risk assets. 

• Investors are increasingly rotating toward emerging markets, Japan, and Europe, where valuations are lower and industrial exposure is higher. 

• The firm remains overweight equities and underweight bonds, while favoring emerging market local-currency debt and safe-haven assets like gold and the Swiss franc. 

The shift reflects a market adapting to AI disruption: capital is moving toward “halo” companies—those with hard assets and lower technological obsolescence risk.

The implication is subtle but important. The rally may continue, but leadership is changing—and investors positioned solely for U.S. tech dominance may find themselves on the wrong side of the rotation.