Markets have climbed to new highs in 2026, yet persistent economic uncertainty has trailed every rally since the year began. Tariff questions, the ongoing Middle East conflict, and sticky inflation have kept investors on edge about what comes next.
In a midyear outlook, Fidelity Investments identified five distinct ideas spanning growth, diversification, income, inflation protection, and deep value.
Each idea targets a gap between where prices sit and where fundamentals point, giving investors a potential roadmap for the second half of the year. Here is what the firm flagged, and what each opportunity could mean for your portfolio heading into the rest of 2026.
5 opportunities in the uncertain market
Fidelity highlights five opportunities investors shouldn’t miss out on.
1. Tech stocks
Technology posted the fastest earnings growth of any S&P 500 sector in the first quarter of 2026, alongside the strongest revenue growth, according to FactSet data. Profit margins expanded, even as companies continued investing aggressively in AI infrastructure, the Fidelity report noted.
Fidelity Director of Quantitative Market Strategy Denise Chisholm noted that elevated valuations look different from prior speculative episodes, the report stated.
The private markets, however, tell a different story: rising valuations and vendor financing pressures point to unsustainable pricing.
During the dot-com era, prices surged while earnings collapsed, but today earnings have been reaccelerating alongside share prices, Chisholm explained. Performance has also become more uneven across the sector, suggesting growing differentiation rather than blind optimism among investors.
2. International stocks
Both developed-market and emerging-market equities outperformed U.S. stocks by a wide margin in 2025, and that gap has persisted through April 30, 2026, according to MSCI index data cited in the report. Even after that run, valuations abroad remain meaningfully lower than domestic benchmarks, the firm noted.
Faris Rahman, manager of the Fidelity Europe Fund, described Germany’s recent infrastructure and defense spending package as the most significant fiscal program since German reunification, according to the report.
In Japan, corporate governance reforms have been fueling a renaissance in shareholder value creation, the firm stated. After nearly three years of sluggish global manufacturing, a broadening number of countries have reported improving factory conditions, Fidelity noted.
3. Precious metals
U.S. inflation has remained above 2% for more than five straight years, and a fresh wave of inflationary pressures tied to the Middle East conflict has pushed headline readings to their hottest levels in several years, the Fidelity report stated.
Gold prices reached a record high above $5,600 per ounce in late January 2026 after climbing more than 60% in 2025, Fidelity reported. The metal has since pulled back into the mid-$4,000s but remains well above where it traded two years ago, according to spot-market data.
Several durable forces have been supporting significant gains in gold and silver prices in recent years, including demand from global central banks, a more fragmented geopolitical landscape, concerns about global deficit spending, and strong industrial demand for certain metals, the Fidelity report noted. The firm outlined three main ways to gain exposure to the asset class.
4. Convertible bonds
Convertible bonds pay interest like traditional fixed income but can be exchanged for shares of the issuing company’s stock, giving holders potential upside if equities rally. Adam Kramer, lead manager of the Fidelity Multi-Asset Income Fund, has been calling this the “golden age” of convertible bonds due to favorable market dynamics, according to the report.
New issuers are entering the market, and roughly one-third of the convertible universe is set to mature over the next few years, creating potential pent-up demand that could provide a tailwind for prices, Fidelity stated.
Recent themes Kramer’s team has played in the convertibles market include AI-related infrastructure buildout and company-specific turnaround stories, the report added.
5. Health care stocks
Health care has been one of the most out-of-favor sectors for years, battered by concerns about major drug patent expirations, a biotech shakeout, and a pullback in early-stage funding. The upside is that sector valuations now hover near their lowest levels in 35 years, Eddie Yoon, manager of the Fidelity Select Health Care Portfolio, noted in the report.
Yoon said he sees “green shoots” emerging across the sector, including improving fundamentals, increased funding activity, and positive clinical trial data, according to the report. The sector spans far more than large pharmaceutical companies, stretching across biotech innovators, medical device makers, diagnostics firms, and health insurers, the firm stated.
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The wide gap between strong and weak businesses in health care makes it one of the market’s most inefficient sectors, where bottom-up research can uncover value opportunities that fewer investors have been exploring, Yoon explained.
In a separate December 2025 Fidelity analysis, Yoon argued that health care stocks have massively underperformed the S&P 500 over the past three or four years, even as the underlying companies advanced their drug pipelines and improved capital efficiency. The economics of the sector, he said, make that disconnect particularly compelling once profitability returns.
“When these companies turn profitable, they historically turn just massively profitable because these are regulated monopolies. Their gross margins can be 90% plus,” Yoon said.
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Fidelity report points to market with more depth than headlines suggest
The common thread across all five ideas is that investor attention has been concentrated in a narrow slice of the market, leaving pockets of value in sectors and asset classes that have been largely overlooked.
Whether it is health care trading at 35-year valuation lows, international stocks still priced well below domestic benchmarks, or convertible bonds riding a wave of fresh issuance, the firm’s investment professionals are pointing to the same pattern: Fundamentals have been improving in places where sentiment has not yet caught up.
Fidelity’s midyear outlook positions the second half of 2026 as a potential window for investors who look past headline-driven uncertainty around tariffs, inflation, and geopolitical risk and focus on where earnings growth, structural reform, and depressed valuations converge beneath the surface.
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