Company Interview / Ride the rally, but watch the dip

Key points:

Positive near-term view on global equities and Q2 earnings growthSemiconductors and Nvidia highlighted as key AI and growth exposuresAnticipated 5–15% equity pullback later in 2026 despite solid fundamentals

Robert Talevski from Activam Group outlines a constructive outlook for global equities through July and the current Q2 earnings season. Talevski notes that sentiment is not excessively bullish, market breadth is improving to about 70%, and only 23% of active managers are beating large-cap indices, which in his view may force buying on dips and support further equity gains. He highlights that the so‑called “Magnificent Seven” have traded sideways since October, helping broaden market leadership.

Talevski expects Q2 earnings growth above 20% year on year, the second consecutive strong quarter, and views the AI boom as not yet resembling a bubble. Semiconductors are characterised as secular rather than cyclical, supporting higher multiples, with Nvidia at roughly 16 times forward earnings and the broader semiconductor sector around 20 times. He points to the S&P 500 at about 23 times one‑year forward earnings, and the equal‑weighted S&P at 19 times, as still reasonable under his assumptions.

Looking ahead, Talevski’s house view anticipates a 5–15% pullback between September and November, potentially triggered by changes to Federal Reserve communication, balance sheet “un‑locking” and tighter oil supply. He states a preference for global small caps and emerging markets, remaining overweight international versus domestic, while expecting Australian small and mid caps (ASX:XSO) to lag in the short to medium term.