HSBC’s Willem Sels reports that global equities are being buoyed by robust earnings growth, particularly in the US Technology and Communications sectors, with artificial intelligence (AI)-driven capital expenditures and productivity gains serving as primary catalysts [1]. The bank maintains an overweight stance on Technology and Communications, while also favoring Materials, Financials, Industrials, and Utilities as key beneficiaries of AI adoption [1].
According to HSBC, analysts project earnings growth of 56% in US technology this year and 25% for the S&P 500, underscoring the significant impact of AI on sector performance [1]. The report notes that following a sell-off in early 2026, technology sector valuations are now considered reasonably priced relative to other sectors, removing valuation as a barrier to further equity upside [1].
AI’s productivity gains are described as spreading across multiple sectors, with policy support such as US tax incentives and improved regulatory conditions in China’s internet sector providing additional catalysts for growth [1]. HSBC identifies attractive global opportunities in semiconductors, data centers, and innovative AI adopters across industries [1].
The bank emphasizes that AI is transforming business operations and competition, making it a long-term investment theme. HSBC expects opportunities to broaden beyond Technology into Industrials, Materials, and Utilities, which are set to benefit from the expansion of data centers and electricity networks, while Financials are supported by strong capital market activity [1].
CONCLUSION
HSBC sees AI-driven earnings growth as a key force supporting global equities, with Technology, Communications, and several other sectors poised to benefit. The bank’s positive outlook is reinforced by strong earnings forecasts and supportive policy environments, suggesting continued upside potential for equity markets.