Fleeing the AI Valuation High Ground: Wall Street Strategists Shift Focus, Mid-tier Consumer Stocks May Lead in 2026

Glonghui January 8th｜Amid concerns over a slowdown in AI-driven trade growth, strategists across Wall Street are searching for new engines to drive the US stock market bull run. A team led by Ben Snider at Goldman Sachs is focusing on companies that benefit from increased spending by middle-class consumers. Snider's team is optimistic about healthcare providers, materials producers, and manufacturers of essential consumer goods. However, they are particularly bullish on companies that sell "non-essential" rather than "essential" goods. The Goldman Sachs team believes that the US economy is set to accelerate, which will boost the profits of companies with stable growth but lower profit margins—a group that has outperformed since October. "Stocks exposed to middle-income consumer spending are particularly attractive. Value stocks will continue to outperform the broader market into early 2026. The real income growth of middle-income consumers will accelerate, which should translate into improved sales growth." Charlie McElligott, cross-asset macro strategist at Nomura Securities International, said: "Economic growth is being repriced upwards. If this happens, it will be a good sign for more traditional value sectors."