Wajana Wongsupasawat, Chief Investment Officer of Kasikorn Asset Management (KAsset), stated that by taking a broad perspective and thoroughly analyzing fundamental factors, investors may find that the current U.S. stock market presents a rare and significant investment opportunity.
Following the Federal Reserve (Fed) 25 basis points rate cut in December 2025, which brought it to the range to 3.50%-3.75% as expected by the market, three Fed committee members have presented differing views, the highest divergence in recent years. Notably, one member proposed a sharper cut of 0.50% to accelerate labor market recovery. KAsset interprets this as a signal that interest rates may decline further in 2026.
Wajana indicated two key drivers that could unlock the potential of the U.S. stock market. The first is the downtrend in interest rates. While the Fed may cut rates more slowly than the market anticipates, the overall direction remains downward, which will reduce financial costs and stimulate sluggish economic activity. He estimated that there will be two additional 25bps rate cuts in 2026 and 2027 respectively.
The next driver is the “One Big Beautiful Act” (OBBBA), a government policy that includes tax cuts and increased spending, which is projected to take full effect in 2026 and likely serve as a positive catalyst for stocks in energy, financial, and consumption sectors.
For investment themes, KAsset recommends two main groups. First, the technology sector, which is still in the early stage of the AI cycle; despite concerns about a potential AI bubble and interest rate uncertainty, this period is seen as an opportunity to accumulate stocks ahead of recovery. Second, the healthcare sector, supported by rate cuts, medical innovations, and the aging population. These stocks remain attractively valued, making them a good diversification choice.
Investors should closely monitor developments in May 2026, which marks the end of the current Fed Chair’s term, as a change in leadership could lead to shifts in monetary policy or a more aggressive rate-cutting cycle than expected. Supported by government policy, a declining interest rate trend, and growing corporate profits, the U.S. stock market remains an attractive investment option for the coming year.
