Chris Berkouwer, Deputy Head of Global Stars Equity Strategy at Robeco Asset Management, stated at a conference on the 14th that the exceptional surge in US corporate profits occurring without a recession is accompanied by inflation pressure, and that scenarios of the Federal Reserve raising interest rates should be considered. Berkouwer explained that the current profit growth acceleration is unusual because it did not follow a recessionary period, unlike similar surges seen after the financial crisis or COVID-19 recovery. He noted that market discussions have shifted from rate cuts to potential rate hikes, adding that while Robeco does not fully endorse that argument, the firm agrees that rate hike scenarios must be factored into planning.
Berkouwer spoke at the 'Global Multi-Asset Outlook for the Second Half of 2026' conference held at the Financial Investment Education Center in Yeouido, Seoul. Robeco Asset Management manages $396 billion in assets.
Robeco Projects High Teens Global Earnings Growth and High 20s S&P500 EPS Growth
Berkouwer projected global corporate forward earnings growth in the high teens and S&P500 earnings per share growth accelerating to the high 20s. He attributed this to delayed effects of 2024 rate cuts, the One Big Beautiful Bill Act (OBBBA) incentivizing domestic US investment, and artificial intelligence capital expenditures currently powering all growth engines.
Berkouwer stated that this level of profit growth surge previously appeared during recovery periods after the financial crisis or COVID-19, but emphasized that this instance is exceptional because it did not pass through a recessionary phase. He pointed out that such growth is accompanied by inflation, noting that inflation concerns emerged from early in the year before the Iran situation caused energy price spikes.
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Chris Berkouwer, Deputy Head of Global Stars Equity Strategy at Robeco Asset Management [Source: Robeco Asset Management]
Growth Stock Concentration Reaches 60% Exceeding Historical Maximum
Berkouwer diagnosed the current market as a momentum-driven market similar to the early 2000s IT bubble. He stated that the fundamental difference is that technology companies now generate profits, but noted that growth stock weighting in indices has concentrated to 60%, while the historical maximum was 40-50%.
Berkouwer stated that AI emerged as a powerful theme drawing oxygen from other sectors, but now the AI-led theme is spreading beyond technology to other sectors. He described the current period as an opportune time to reduce positions in top-performing stocks while capturing undiscovered opportunities across the broader market. He disclosed that Robeco has incorporated positions in financials and healthcare with solid fundamentals and undervaluation.
AI Theme Spreads Beyond Technology to Other Sectors
Berkouwer clarified that his recommendation does not mean abandoning AI entirely for other markets. He emphasized that the AI story remains valid and expectations for earnings upward revisions remain strong. He stated that investors should maintain exposure to AI while diversifying into sectors where the AI theme is now expanding.
Semiconductor Sector Growth Trajectory to Continue for Years
Regarding whether the semiconductor sector has peaked, Berkouwer stated it has not peaked and the growth trajectory will be maintained for years. He explained that semiconductors are a sector where governments place strategic priority and assume risk, and that demand cannot be met even if capital expenditures are doubled, with long-term contracts extending the cycle.
Berkouwer stated that for the second half of the year, he projects global stock markets to trend upward overall, but emphasized the need to stand near the exit in case situations deteriorate. He stated that interest rates, geopolitical risks, and AI will play important roles in the market.
FAQ
Why does Robeco consider Fed rate hike scenarios despite market expectations of cuts?
Chris Berkouwer stated at the conference on the 14th that the exceptional surge in US corporate profits without a recession is accompanied by inflation pressure. He noted that market discussions have shifted to potential rate hikes, and while Robeco does not fully endorse that argument, the firm agrees that rate hike scenarios must be factored into planning.
What is Robeco's view on growth stock concentration in current markets?
Berkouwer stated that growth stock weighting in indices has concentrated to 60%, exceeding the historical maximum of 40-50%. He described the current period as an opportune time to reduce positions in top-performing stocks while capturing opportunities across the broader market, disclosing that Robeco has incorporated positions in financials and healthcare with solid fundamentals and undervaluation.
Has the semiconductor sector peaked according to Robeco?
Berkouwer stated the semiconductor sector has not peaked and the growth trajectory will be maintained for years. He explained that semiconductors are a sector where governments place strategic priority and assume risk, demand cannot be met even if capital expenditures are doubled, and long-term contracts are extending the cycle.
