Haru Insights — February 28, 2026

Macro Conditions

Overall Economic Environment: Global economic growth remains robust, with forecasts showing 2.9% real global GDP growth in 2026 (US at 2.8%, China at 4.8%). The macro backdrop is expansionary, particularly in the US and China, supported by fiscal stimulus, major tax reform, and a record-breaking wave of capital investment focused on AI infrastructure, data centers, and power systems. However, headline optimism is tempered by persistent inflation pressures in input costs, structural geopolitical volatility, and evolving policy risks around trade and tariffs.

Key Macro Factors:

  • 1. Persistent Input Cost Inflation

    • Current State/Trend: Despite a projected easing in headline inflation (US CPI expected to fall to 2.2% by end-2026), underlying input costs—memory, power, labor, and specialty commodities—remain elevated due to surging capex in AI/datacenter infrastructure. Key executives report memory and electronic component price increases of 20% or more, with shortages projected to persist for several years.
    • Market Implications: Margin pressures for consumer-facing, airline, and tech hardware sectors; strong tailwinds for mining/commodity producers, utilities, and firms at the choke points of the AI supply chain.
    • Notable Developments: $7 trillion in data center investments projected over five years; tight supply of copper, lithium, and rare earths persists.

  • 2. Geopolitical Risk and Trade Policy Volatility

    • Current State/Trend: Middle East tensions are causing airspace closures, flight disruptions, and repeated spikes in oil prices. The US Supreme Court's overturning of IEEPA-based tariffs adds volatility to global trade flows and corporate guidance, while uncertainty lingers regarding Section 122 tariff replacement and refund execution.
    • Market Implications: Energy, travel, and supply chain-sensitive sectors exhibit amplified volatility; risk of short-term commodity price shocks and operational disruptions.
    • Notable Developments: Airlines under margin pressure; oil expected to average $60/bbl in 2026 (JPM outlook), but with high price spike risk from escalations.

  • 3. Shifting Interest Rate, Fiscal, and Credit Backdrops

    • Current State/Trend: Central banks remain cautious—Fed rate cuts delayed as capex inflation persists; rate cuts arriving sooner in UK and Europe. Fiscal regime (US OBBBA tax reform) unlocks near-term capex, disposable income, but adds $4.5 trillion to deficit.
    • Market Implications: Near-record tight credit spreads, robust capital markets, and active loan growth support risk assets in the US. Capex-heavy sectors, hardline retail, and travel may see short-lived boosts from larger tax refunds.
    • Notable Developments: Avg. 2026 US tax refund grows to $3,500 (+20%); most refunds applied to debt/savings before hitting discretionary goods.

  • 4. Global Economic Momentum and Labor Dynamics

    • Current State/Trend: Stable employment (US unemployment at 4.28%, jobless claims at 206k), rising business investment, and resilient consumer spending (despite a K-shaped bifurcation) are undergirding positive growth trajectories in both developed and emerging markets.
    • Market Implications: Positive for industrials, select consumer, and infrastructure; risk of wage inflation and supply bottlenecks lingering.
    • Notable Developments: AI and data center buildout driving up construction activity and software engineer demand (+11% YoY).

Outlook Considerations: The macro environment is characterized by rapid sectoral divergence, significant capex-driven inflation "hot spots", and ongoing high-impact policy/geopolitical risk. While fundamentals are strong for real asset and capex-intensive sectors, investors should closely watch inflection points in capex spending, duration of input cost pressures, and any abrupt shifts in energy/geopolitical scenarios that may drive cross-asset volatility.

Assets to Watch

1. AES Corp. and the AI-Utility Power Sector (AES, VST, XEL, BEP, BEPC)

  • Investment Perspective: The AI-power utility sector warrants close monitoring as the backbone of record-setting AI and data center growth. These companies are directly capturing demand from long-term power purchase agreements with tech hyperscalers and stand to benefit from durable, contract-driven growth and margin expansion.
  • Comprehensive Reasoning: Cross-industry capital expenditure in AI is creating multi-decade visibility for AES, Vistra Corp. (VST), Xcel Energy (XEL), and Brookfield Renewable (BEP/BEPC), all of which have announced transformative agreements to supply clean power to data center operators like Meta Platforms, Amazon, and Microsoft. Utilities historically viewed as defensive are now at the heart of the digital economy’s infrastructure buildout, as evidenced by record demand and robust capital returns. Their ability to negotiate favorable terms, raise dividends, and execute on renewables transition provides downside protection and upside optionality on further AI-driven grid expansion. Multi-source agreement on this theme, including both macro and micro data, strengthens conviction.
  • Risk Considerations: Overexuberance or delays in AI datacenter buildouts could reduce future demand growth; execution risk in renewables/transition; regulatory or permitting challenges at the state or federal level.

2. Nvidia (NVDA) and Advanced Micro Devices (AMD): AI Infrastructure Hardware

  • Investment Perspective: Both NVDA and AMD should be closely watched as linchpins in the current and future waves of AI infrastructure spending, with earnings execution and guidance having market-wide impact.
  • Comprehensive Reasoning: Nvidia continues to set the pace for the sector, delivering 70% YoY revenue growth, maintaining dominant market share in AI accelerators, and representing the primary supplier to hyperscalers. AMD is rapidly emerging as a true peer, with massive AI chip supply deals (including a transformative, multi-year contract with Meta Platforms), robust guidance upgrades, and ecosystem partnerships that challenge Nvidia’s legacy lead. The sustainability of the AI hardware cycle will be dictated by these companies’ ability to fill elevated order backlogs and execute against hyperscaler demand. Cross-source signals converge around both their central roles and the risks of any execution or capex slowdown.
  • Risk Considerations: Extreme valuations and parabolic momentum expose both stocks to potential sharp corrections if order flow stalls; dependency on hyperscaler capex cycles; long-term threat from in-house chip development by cloud providers.

3. Chevron (CVX): Energy Sector Barometer

  • Investment Perspective: Chevron stands out as a sectoral bellwether for global energy amid shifting supply-demand dynamics, policy, and geopolitical risks. Investors should monitor for both opportunity and risk.
  • Comprehensive Reasoning: Chevron’s exclusive expansion into Iraq’s West Qurna 2 oilfield and strong capital allocation provides upstream leverage and downside buffer against price volatility. Despite a structurally bearish consensus for oil prices ($60/bbl Brent forecast), supply shocks and ongoing geopolitical uncertainty (notably U.S.-Iran tensions) retain asymmetric tail risk for the sector. CVX further benefits from exposure to AI-driven energy demand (especially in LNG and gas), robust free cash flow, and the ability to return capital even in turbulent markets.
  • Risk Considerations: Extended oil supply surplus would challenge margins; major insider share sales signal possible caution about near-term valuation; sector is highly sensitive to both downside shocks (surplus) and upside wild cards (disruptions).

4. Bank of America (BAC) and the US Financial Sector (Risk Signal)

  • Investment Perspective: The recent, coordinated insider selling and institutional stake reduction at Bank of America are a cautionary signal for investor sentiment and sector valuation, despite stable macro indicators.
  • Comprehensive Reasoning: Although economic activity, credit markets, and capital market fees remain strong for US banks, multiple high-level insiders and Berkshire Hathaway have trimmed positions in BAC and several sector peers. This may indicate limited near-term upside at current valuations or anticipation of less favorable regulatory, margin, or capital dynamics. As a result, BAC serves as a monitoring tool for broader financial sector risk appetite, and ongoing leadership selling may presage increased sector volatility.
  • Risk Considerations: Overvaluation, credit quality surprises, or a reversal in positive capital markets activity may trigger underperformance; insider selling is not determinative but is historically associated with reduced forward sector returns.

Trends and Themes

1. AI Infrastructure CapEx Boom

  • Supporting Evidence: Multiple major technology, utility, and energy firms announced high-visibility, multi-year partnerships (e.g., Amazon/OpenAI, Meta/AMD, Brookfield Renewable/Microsoft) to build foundational AI datacenter and power infrastructure. Underlying this are projections of $7 trillion in data center investments, multi-decade power purchase agreements, AI hardware earnings beats, and observable surges in demand for grid energy, specialty power, and advanced semiconductors.
  • Market Implications: This boom is systematically revaluing both the hardware and power sectors, with utilities, semiconductor companies, and mining/critical materials suppliers enjoying outsized visibility and competitive positioning. AI infrastructure sustainability is now the fulcrum for risk and reward across value chains. Monitoring capex cadence and hyperscaler order health is essential; any downturn could cascade across supply networks and related equities.
  • Time Horizon: Long-term (years)
  • Convergence Notes: Multi-source validation from industry, macro reports, and leader commentary elevates conviction.

2. Sector Rotation from Overvalued AI/Tech Growth Stocks to Real Assets and Infrastructure

  • Supporting Evidence: Elite institutional investors (e.g., Bridgewater) have shifted portfolios from legacy AI/software and high-multiple tech to infrastructure, energy, mining, and AI utility plays. Historic insider selling is occurring in high-profile AI/tech, while cyclical sectors benefit from inflows and capital allocation realignment. Quantitative sector performance and capital markets activity confirm this trend.
  • Market Implications: Real asset and infrastructure stocks are receiving relative outperformance and narrative momentum, while stretched valuations in software/AI names face heightened correction risk. Investors allocating new capital are increasingly rewarding dividend growth, tangible assets, and long-term power/commodity contracts over uncertain AI monetization.
  • Time Horizon: Medium- to long-term (quarters to years)
  • Convergence Notes: Signals converge from daily briefings, institutional action, and sector rotation analytics.

3. Inflation and CapEx-Driven Input Cost Pressures

  • Supporting Evidence: Persistent input cost increases (especially for memory, power, specialty metals, and labor) are observed across multiple sectors. Executives report ongoing shortages and 20% price hikes for components, while macro data indicate sticky inflation even as headline CPI moderates. Policy volatility, tariff policy swings, and rising capex further fuel these cost pressures.
  • Market Implications: Margin-dependent sectors (e.g., airlines, consumer goods, traditional tech hardware) remain vulnerable, while commodity/mineral producers and power/utilities have greater pricing power and long-term offtake visibility. Investors should beware the risk of inflation "hot spots" disrupting consensus easing and sector leadership.
  • Time Horizon: Short- to medium-term
  • Convergence Notes: Theme clearly supported by industry commentary, macroeconomic data, and cross-sector pricing trends.

This content is for informational purposes only and does not constitute financial, investment, or trading advice. Always consult a qualified financial professional before making any investment decisions.