In a recent survey conducted by Natixis Investment Managers, it was revealed that a majority of institutional investors in the Asia-Pacific region are anticipating a market correction in 2026. The concerns cited by investors include the potential for a tech bubble, geopolitical tensions, and the possibility of a recession. Despite the challenges faced in 2025, such as tariffs, geopolitical conflicts, and supply chain disruptions, global markets remained resilient. However, the sentiment among institutional investors suggests that a correction is long overdue.
Among Asia-Pacific investors, the top concern was the potential for a tech bubble, followed by worries about geopolitical shocks and recession. Global investors, on the other hand, ranked geopolitical shocks as their primary concern. This sentiment has led to the belief that markets may face challenges in the coming year.
Dora Seow, CEO of Natixis Investment Managers Singapore, noted that after a period of US market outperformance, international and non-US equities gained focus in 2025. The survey also indicated that institutional investors are seeking new sources of alpha in markets such as Asia-Pacific, despite preparing for heightened uncertainty in 2026.
Interestingly, 60% of investors in the region are planning to increase their allocations to equities within their home region to diversify away from the US. This shift in focus aligns with the belief that markets outside the US may offer better opportunities for growth.
When it comes to specific markets, views on China remain subdued, with slow growth being seen as the “new normal.” However, Asia-Pacific investors express confidence in China’s resilience, with 70% believing that the country could withstand a prolonged trade war with the US. Additionally, the survey highlighted the increasing prominence of alternative investments in portfolio allocation, with over 60% of investors planning to increase their allocations to cryptocurrencies in the coming year.
Overall, the survey findings were based on responses from 515 institutional investors managing a collective $30 trillion in assets worldwide. The Asia-Pacific markets included in the survey were mainland China, Hong Kong, Taiwan, Japan, Singapore, and South Korea.
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