In particular, the asset manager sees attractive yields in hard currency debt. In local currency debt, it favours Central and Eastern Europe, selective parts of Latin America, namely Columbia and Brazil as well as Asia – India, the Philippines and Korea – for carry and valuation. 

The firm said it is positive about emerging market equities and sees pockets of opportunities favouring value and momentum styles in Latin America, Eastern Europe and selectively in Asia, in sectors linked to digital assets. 

In Chinese equities, Amundi expects to move from neutral to select positions in the tech sector and areas of comparative advantage such as the electric vehicle supply chain, renewable energy. The firm is positive about India on a medium-term horizon where the ‘Make in India’ transformation offers long-term growth potential in many fields such as manufacturing, consumption, infrastructure, global supply-chain shifts, financial inclusion technologies. 

Emerging markets have benefited from easier global financial conditions, balanced domestic policies and front-loaded export demand in 2025, as well as the weaker dollar. Growth is likely to stabilise but keep outpacing that of developed economies. “Cautious monetary easing should continue, with no signs of fiscal dominance.  Asia will remain the primary growth engine, despite moderating growth in China (4.4 per cent and 4.2 per cent) and India (6.3 per cent and 6.5 per cent), Amundi said. In Latin America, a series of elections could usher in more business-friendly administrations. Structural forces are also at play: geopolitical realignment, supply-chain reconfiguration and an intensifying technological race, in which Asia stands out. “Key risks across emerging markets are a stronger US dollar and higher US Treasury yields,” Amundi added.

Amundi is neutral on US equities despite the US Federal Reserve’s procyclical stance. The firm believes that European industrials and infrastructure should provide new entry points in the second half of 2026 to benefit from a structurally weaker dollar and longer-term themes – defence spending, electrification and repatriating assets from the US – and revived interest in the eurozone if the German plan to hike defence spending materialises and reforms advance. The asset manager is positive on European financial, industrial, defence and green-transition sectors, as well as on small and mid-cap equities. “Europe can still play the tech cycle through industrials and capital goods. We also seek opportunities in the expanding Asian tech ecosystem. Japan can also benefit from the corporate reform and weaker yen,” Amundi said.

On fixed income, the firm believes that the current backdrop calls for a tactical approach to duration and a neutral-to-slightly-short stance on sovereigns.  Quality credit becomes a core allocation for fixed income investors to diversify away from Treasuries, and it is clearly overweight. “We remain cautious on US high yield and Japanese government bonds. A positive stance on European bonds remains a key call for 2026, with a focus on peripheral bonds and short maturities, UK Gilts and investment grade credit, particularly in financials,” Amundi continued. 

The asset manager believes that Europe’s attractiveness should rise over the year as reforms, together with defence and infrastructure spending, translate into concrete opportunities in investment grade credit and small- and mid-cap equities. “In Europe, we expect growth to remain below potential at 0.9 per cent in 2026, then to recover at 1.3 per cent in 2027, both in the eurozone and in the UK. US growth should experience a shallow slowdown in the coming quarters, before picking up to reach 1.9 per cent in 2026 and 2.0 per cent in 2027, remaining below potential,” the firm added.

Diversification and hedges
For real-return resilience, Amundi favours greater allocation to alternative income and inflation hedges in real assets. “Private credit and infrastructure are well positioned to benefit from structural themes such as electrification, reshoring, artificial intelligence, and robust demand for private capital, particularly in Europe,” the firm continued. “Diversification should also structurally include a broader commodities exposure, in particular to gold, and selected currencies such as the yen and euro and emerging currencies that may benefit from a weaker dollar. “We favour high-carry currency such as the Brazilian real or South African rand,” Amundi said. 

“Diversification remains the most effective defence in a world of concentrated equity markets and high valuations,” Vincent Mortier, group CIO of Amundi, added. “Investor portfolios must rebalance across styles, sectors, sizes and regions to mitigate risks and capture opportunities, notably in emerging markets and European assets.”

A number of wealth managers have come out recently in favour of emerging markets and Asia, for instance Natixis Investment Managers, Orbis Investments, Aberdeen Investments, Paris-based Carmignac, as well as GIB Asset Management and Franklin Templeton. See more here, here and here.