High net worth (HNW) and ultra HNW investors should not underestimate the resilience of the US economy, as tech-driven productivity growth is outweighing concerns about the economic cycle being in its late stage, according to HSBC Private Bank.

The private bank’s investment outlook for 2026 argued that the exponential adoption of artificial intelligence (AI) would not only benefit tech and utilities firms, but also smart adopters in other sectors.

Despite this, HSBC Private Bank has trimmed its overweight position on US stocks, aiming to mitigate valuation risks and take advantage of growing diversification opportunities across other sectors, geographies, styles, and asset classes.

Its Resilience in a Transforming World report also said that “excessive pessimism” had resulted in analysts underestimating earnings growth, and that the private bank was more worried that the market could be pricing in too many Federal Reserve rate cuts.

HSBC Private Bank acknowledged that while the current market was a positive one for riskier assets, there was likely to be a fair amount of short-term market swings due to concerns about the speed of the AI roll-out, debt piles, inflation, and geopolitical uncertainty.

Its four priorities going into 2026 were to look across and beyond AI; manage market volatility; unleash the power of income; and capture opportunities from Asia.

“Even as US economic growth slows a little, the stock market should do well as long as tech innovation continues,” said HSBC Private Bank and Premier Wealth global chief investment officer, Willem Sels.

“While there are concerns over unconventional policies and rising debt, US economic data has generally surprised on the upside, and the latest earnings season had a near-record percentage of upward surprises.”

HSBC Private Bank and Premier Wealth chief investment officer, Cheuk Wan Fan, added: “As the world’s technology hardware powerhouse, largest consumer and manufacturer, Asia is all set to benefit from the AI investment cycle and innovation-driven productivity gains.

“We are positive on mainland China, Japan and South Korea for their innovation-led growth opportunities and corporate governance reforms. We are also positive on Hong Kong and Singapore stocks due to their attractive valuations and high dividend yields.”

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