HSBC’s Willem Sels Says AI Productivity Gains Could Push US Stocks Higher Through 2026

HSBC Private Bank has turned more positive on US equities, arguing that artificial intelligence is creating productivity and earnings gains that markets have not fully reflected. Willem Sels, the bank’s global chief investment officer, said the economy and companies have proved more resilient than expected, while further AI adoption gives the rally room to continue.

The bank’s view rests on two linked claims: corporate earnings can rise as businesses automate work and improve output, and current valuations look less demanding when measured against that growth. HSBC’s outlook places AI at the center of the next phase of the US stock advance, rather than treating it as a narrow technology trade. Bloomberg’s coverage described the bank’s position as an argument that US stocks are undervalued relative to their AI potential.

HSBC sees the S&P 500 reaching 7,500 by the end of 2026, with further gains in the AI trade still ahead. That forecast reflects an expectation that earnings growth will broaden as companies move from buying AI infrastructure to using it inside operations, sales, software development and customer service. Finance.yahoo reported the target alongside Sels’ view that there is “more to come” from the theme.

The forecast also places a demanding burden on execution. Investors must see measurable improvements in margins, output or revenue, rather than rising spending alone. Tradingpedia framed the thesis around AI-driven earnings lifting stocks further, while FXStreet described HSBC’s equity outlook as combining AI-led upside with an increased focus on income. That combination points to a market strategy balancing growth exposure with cash returns and dividend support.

Companies that adopt AI effectively are positioned to capture the largest productivity gains, according to the investment view. The expected winners extend beyond chipmakers and cloud providers to businesses that can use software to reduce costs, increase employee output and improve decisions at scale. CNBC’s related coverage emphasized that AI adopters will benefit as productivity gains accelerate.

A separate CNBC item focused on stocks identified by Goldman Sachs as beneficiaries, reinforcing the broader market shift from asking who builds AI systems to asking which companies turn them into earnings. That distinction matters for portfolio construction. Hardware suppliers can benefit from demand, but software vendors and large operating companies must show that AI spending changes their financial results. HSBC’s thesis therefore depends on adoption spreading through the wider corporate economy, not remaining concentrated in a few technology names.

HSBC also sees upside in Chinese software stocks tied to AI, even as global market jitters continue. Finance.yahoo reported that the bank’s view extends beyond US technology leaders, reflecting an expectation that AI investment and software demand can support selected Chinese companies despite geopolitical, economic and market risks.

That regional angle broadens the investment case but introduces extra variables. Chinese software companies face different regulatory conditions, capital-market dynamics and competitive pressures than US firms. The contrast highlights the central feature of HSBC’s outlook: AI is treated as a productivity cycle with country-specific winners, rather than a single index trade. Investors must separate the technology’s operating benefits from valuation, policy and market risks in each region.

HSBC’s bullish stance depends on productivity gains arriving quickly enough to justify elevated expectations. If AI improves output and margins, higher valuations can be supported by stronger earnings. If companies continue spending heavily without visible returns, the market has less room for error.

HSBC’s own investor research has stressed that people remain important in financial decisions even as AI changes how investors assess opportunities. Its “Trust Threshold” release said investors are becoming more comfortable with AI but still want human judgment in decision-making. That principle applies to the stock outlook as well: AI can supply a powerful earnings narrative, but investors still need to test adoption rates, cash flows and competitive durability. The bank’s positive call is an investment thesis, not a guarantee of index performance.

The next test for HSBC’s forecast is evidence that AI productivity gains are moving from corporate plans into reported results. Investors will track earnings growth, operating margins, capital spending, software demand and guidance from companies exposed to AI adoption. They will also watch whether gains spread beyond a small group of large technology businesses.

HSBC’s shift to overweight US stocks gives the market a clear benchmark for the thesis: the S&P 500 target of 7,500 by year-end 2026. IBM’s HSBC relationship materials and HSBC’s corporate outlook provide broader context for the enterprise technology push, while market commentary from Pluang and Tradingpedia shows how quickly the theme is being packaged for retail investors. The rally’s durability will depend on financial proof, not enthusiasm alone.