Stay in Play – Counterpoint February 2026
10 mins to read this article
Daniele Antonucci
Daniele Antonucci is a managing director, co-head of investment and chief investment officer at Quintet Private Bank. Based in Luxembourg, he jointly chairs the investment committee, owning decision-making and performance outcomes. As head of research, Daniele oversees the investment strategy feeding into portfolios and the teams of specialists across asset classes and solutions, ranging from macro, fixed income and equities to funds, alternatives, and structured products and derivatives. He leads the network of chief strategists, communicating the house view on the economy and markets to financial advisors, clients and the media.
Prior to joining Quintet in 2020 as chief economist and macro strategist, Daniele served as chief euro area economist at Morgan Stanley in London. He completed the High Performance Leadership Programme at Saïd Business School, University of Oxford, holds a master’s degree in economics from Duke University and graduated from the Sapienza University of Rome. Featured in The Economist and Financial Times and often quoted in the generalist press, he’s a published author in finance and economics journals and investment magazines, a frequent speaker on CNBC and Bloomberg TV, and an ECB Shadow Council member.
What you need to know
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Geopolitical headlines remain volatile, but history shows that most events have limited impact on medium-term market returns.
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The economy, policy and earnings backdrop has improved. This continues to support equities, even if volatility persists.
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We keep our strategy unchanged. Staying invested and diversified to compound returns has historically been more effective than reacting to short-term noise.
Markets ups and downs
Volatility was high across many asset classes at the start of the year. Markets have now recovered part of their losses, but US equities still ended the month lower and lagged other regions. One reason was the launch of new 'plug-ins' for Anthropic's Claude Cowork platform, which raised questions about the long-term strength of some software and information businesses as AI advances. By contrast, European and emerging market equities held up better. The dollar initially weakened before stabilising. Bond yields stayed within a broad range.
Gold and silver rose sharply early in January. Their gains appeared driven more by momentum than by safe‑haven demand. The later pullback, plus data showing that central banks reduced their gold holdings in 2025, supports this view. We anticipated these risks in December, when we cut our tactical gold overweight.
We still hold gold as a long‑term diversifier. Rate cuts, a softer dollar over time, geopolitical risks and some central bank demand all help. The most recent price moves, showing a partial rebound, partly reflect this. Silver is more tied to industrial demand and valuations look stretched, so we remain cautious in the near term.
Geopolitical escalations and de-escalations
Recent events in Greenland show how unpredictable geopolitics can be. After ruling out military options in Davos, President Trump signalled a reduction in trade tensions with Europe. Both sides now appear to be working on a framework that links a pause in new US tariffs to greater US military involvement in Greenland and a broader role in key investment decisions.
At the same time, the EU announced a new trade agreement with India. Lower tariffs help strengthen ties with Asia and offer a partial counterweight to transatlantic uncertainty. Over time, we expect trade patterns to continue to become more regional and geopolitically driven.
The broader lesson is familiar: don’t trade geopolitical headlines. Equity markets often react briefly to geopolitical news. But, over the medium term, returns tend to be similar to those in less volatile periods. This is why we see diversification as the most reliable way to manage volatility.
New Fed Chair, familiar constraints
Despite ongoing political noise, the global economy is gaining strength. The International Monetary Fund recently raised its 2026 global growth forecast to 3.3%. Improved expectations for the US and China support the view that economic conditions are getting better. Lower trade uncertainty, monetary and fiscal support, and higher AI‑related investment all contribute.
President Trump’s nomination of Kevin Warsh as the next US Federal Reserve (Fed) Chair, arguably the most influential economic policy role worldwide, could influence how investors view the market outlook. Warsh served as a Fed Governor during the global financial crisis and has more recently sounded open to lower policy rates, while historically pushing back against Fed balance sheet expansion.
Looking ahead, markets are likely to test his commitment to the Fed’s dual mandate of price stability and full employment. Warsh has argued that AI-driven productivity gains could lower inflation, offering a rationale for rate cuts. But major policy shifts still require committee agreement. For this reason, we do not expect a sharp change in policy later this year, even if uncertainty around the longer‑term path has grown.
Sticking to our strategy
We stay overweight equities and underweight bonds. That said, given the uncertainty, our equity tilt is moderate. We prefer the US, Europe and emerging markets. Each region brings something different: long‑term growth and AI exposure from the US, selective value and themes such as defence and infrastructure from Europe, and attractive valuations with solid earnings prospects from emerging markets, which also benefit from a weaker dollar.
Our US equity exposure is diversified. First, we also hold equal‑weighted US equities, which increases our exposure to financials and industrials that may gain from deregulation and stimulus, while reducing the focus on large technology names. Second, we partly strip out currency effects to soften the impact of a weaker dollar when converting into euros. Third, where permitted, our warrant provides downside protection when US equities fall.
In fixed income, we’re still underweight US Treasuries because of the risks from high US debt levels. However, valuations are improving, which is why we recently added selectively. We prefer European government bonds and are overweight short-dated ones, as well as UK gilts. We also keep a reduced exposure to corporate credit outside Europe and stay cautious on riskier bonds, where valuations look expensive.
We sold our Japanese government bond position in December. We were concerned that a large fiscal boost could reduce their value over time. The recent election strengthened Prime Minister Takaichi’s position and increased the likelihood of further stimulus. This supports Japanese equities but is negative for bonds and the yen, reinforcing our decision.
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