AOR Update (Podcast): Soft patch ahead?

As we navigate the ever-evolving economic landscape, investors and financial advisors should be attentive to several key trends. The US economy shows resilience with a decreasing probability of recession, as indicated by the ClearBridge Recession Risk Dashboard. Yet, caution is warranted with potential soft patches in economic activity due to tariffs and geopolitical tensions. The labor market remains robust but may slow down as part of a natural maturation process.

Opportunities lie in diversification within US equities and internationally, where non-US stocks could benefit from potential dollar weakness. The recent fiscal stimulus provides an impetus for future economic acceleration, creating a conducive environment for active management strategies to thrive amidst broader market participation beyond mega-cap tech stocks. Understanding these dynamics will be crucial for making informed investment decisions moving forward into 2026.