Hard Assets Set to Gain as Credit Stress Spreads Into 2026, Veteran Strategist Says
Veteran market strategist David Rosenberg warns that credit stress will extend into 2026, boosting demand for hard assets such as gold, commodities and real assets. He points to rising borrowing costs, tightening credit conditions and a wave of corporate and consumer balance-sheet strain as key drivers that will push investors toward inflation hedges and tangible stores of value. Rosenberg expects cyclical sectors to face pressure while precious metals and commodity-linked assets may outperform. He also highlights the potential for credit spreads to widen, bank lending standards to tighten further, and risk assets to see increased volatility. For traders, the strategist recommends positioning for higher real-asset exposure, monitoring credit spreads and bank indicators, and preparing for greater market dispersion between cyclical equities and inflation-protected instruments.
Bullish
The strategist’s outlook is bullish for hard assets specifically, not for risk assets broadly. Expectation that credit stress will persist into 2026 typically drives capital into safe-haven and tangible stores of value — gold, commodities and real assets — which historically outperform during periods of rising credit spreads and tighter bank lending. Traders should view this as a bullish signal for precious metals and commodity-linked instruments: increased demand and potential price appreciation. Short-term effects may include heightened volatility and negative pressure on cyclical equities and credit-sensitive tokens; long-term effects could be sustained inflows into inflation hedges and reduced appetite for leveraged risk. Similar episodes (e.g., post-2008 flight to gold, commodity rallies during stagflationary periods) show capital rotation from credit-dependent assets to hard assets. Key actionable items: monitor credit spread curves, bank lending surveys, and inflation expectations; consider long positions in gold (and related ETFs/futures) and selective commodity exposure, while hedging cyclical equity or high-leverage positions.