Why the melt-up is still on

LAST year was terrible for financial predictions, but I am happy to make another for 2026, which is that stocks and other risky assets will power higher. The muck is still sliding off Teflon-coated markets, pessimists appear to be giving up the fight and the melt-up is very much in play.

Casting an eye across the outlooks of the major investment banks and big asset managers, one would be hard-pressed to find a naysayer. US policy on trade and interference in central banking remains a clear and present danger to every portfolio, but the astonishing market resilience of 2025 makes it very difficult to justify whining from the sidelines.

The dark days of April, when US President Donald Trump’s wackadoodle global trade policy sent markets careering lower, are an increasingly distant memory.