2026 Outlook: International Stocks and Economy

Charles Schwab

Michelle Gibley

Research

16 Pages

Michelle Gibley says international stocks could be poised for another strong year in 2026 due to accelerating global growth, attractive valuations and the potential for dollar weakness.

Date published: December 9, 2025

Key Takeaways

Strong 2026: International stocks could be poised for another strong year as earnings and economic growth are expected to accelerate and stocks are attractively valued compared with stocks in the S&P 500® index.
Diversification: Developed-market international stocks could provide diversification to the tech-heavy S&P 500 index. Germany is embarking on a massive fiscal stimulus plan and Japanese companies are enacting shareholder-friendly reforms.
Growth & AI: Emerging-market stocks may provide investors an alternate way to participate in the growth of artificial intelligence (AI). China, for example, has the advantage of plentiful low-cost electricity, a key AI input.
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