JPMorgan's Co-head of Global Banking Filippo Gori painted an optimistic picture of global investment trends during the World Economic Forum in Davos, highlighting particularly strong performance from India and robust merger and acquisition activity worldwide. Speaking to CNBC-TV18 on the sidelines of the forum, Gori noted positive investor sentiment across multiple regions and strengthening market conditions.

India's Strong Market Performance

Gori emphasized India's exceptional transformation over the past 15 years, with the country demonstrating remarkable resilience in global markets. India's significance in the Asia-Pacific region has grown substantially, as evidenced by its commanding share of regional investment flows.

The banking executive highlighted that capital flows into India have remained steady despite currency fluctuations, supported by multiple growth drivers. Key factors contributing to India's sustained investor appeal include:

• Domestic consumption growth
• Manufacturing sector expansion
• Export performance
• Infrastructure reforms
• Services sector development

Gori expressed particular pride in JPMorgan's India-based workforce contribution, noting that the country continues to play a central role in the bank's global services operations.

Global Investment Climate

The overall mood among investors remains positive across regions, with several markets showing renewed confidence. Europe has moved past tariff-related concerns, with clients now prepared to invest and concentrate on business growth. In the Middle East, Gori highlighted enormous investments and a wider strategic reassessment of the region's global role, both factors strengthening investor optimism.

IPO Market Outlook

Global IPO activity is expected to strengthen in 2026 after several years of subdued volumes. This anticipated recovery is supported by a backlog of listings and improving market conditions. The US IPO market experienced disruptions in 2025, including a slowdown in April and a government shutdown later in the year, causing several deals to shift into 2026.

Record M&A Pipeline

Mergers and acquisitions activity has reached unprecedented levels, representing the strongest activity seen so far. Current market conditions supporting this robust M&A environment include:

• Low credit spreads
• Clearer visibility on interest rate trajectories in the US and Europe
• Favorable financing environment

Gori noted that large deals returned in the second half of last year, with the M&A pipeline for 2026 being the strongest on record.

Investment Themes for 2026

Looking ahead, three major themes are expected to influence investment decisions in 2026: geopolitics, inflation, and artificial intelligence. AI remains a particular focus for investors, both for its potential to boost productivity and reshape businesses, while also raising concerns around valuations, employment impact, and monetization models.

JPMorgan's Head of India Equity Research Sanjay Mookim has provided a measured outlook for Indian markets, noting that while earnings downgrades have eased significantly, the country is likely to underperform global markets in the near term. His assessment highlights both stabilizing domestic fundamentals and challenging relative positioning against international peers.

Earnings Outlook Shows Stabilization

Mookim observed that the pace of earnings downgrades in India has abated meaningfully, with market expectations for FY26 now appearing relatively stable. However, he cautioned that FY27 estimates may still face cuts, with current consensus growth expectations of around 16% likely to settle near 12-13%.

The more significant challenge, according to Mookim, lies in India's comparative performance against other markets. While large Indian companies may deliver low double-digit earnings growth in rupee terms, other regions including Asia and the US are experiencing higher growth rates.

Currency Impact on Dollar Returns

After adjusting for currency weakness, India's dollar earnings growth could be limited to mid to high single digit over the next year, significantly impacting returns for international investors.

Sector Strategy Favors Consumer Discretionary

JPMorgan continues to prefer consumer discretionary stocks over capital goods and infrastructure names. Mookim cited improving consumer data and better demand trends in discretionary categories as key drivers for this positioning.

The firm expects limited support for capex stocks due to several fiscal constraints:

• Weak government revenues
• Anticipated tax cuts
• Limited room to raise fiscal deficit
• Reduced chances of fresh public capex push in upcoming budget

Market Headwinds from Supply Factors

Mookim warned that equity supply is likely to remain elevated in 2026 if markets stay stable, potentially capping near-term upside. Key supply sources include:

• Block deals
• Promoter sales
• New listings

This high supply environment could limit market performance even if fundamental conditions improve.

Global Comparison and Risk Factors

The JPMorgan analyst noted that economies such as the US and China are benefiting from fiscal support, creating stronger momentum elsewhere compared to India. He emphasized that "at least in the near term, momentum elsewhere is probably going to be stronger."

Regarding global risks, Mookim observed that markets have largely ignored geopolitical tensions and political uncertainty, focusing instead on earnings momentum. He suggested that a sharp sentiment shift would likely require a major shock, such as escalation in trade tensions or reversal in AI-led market optimism.