By Alpha Desk December 2, 2025, 10:36:08 AM IST (Published)
Lyn Alden, founder of Lyn Alden Investment Strategy, says the strong run in US technology and artificial intelligence stocks may be nearing its peak and that global investors could rotate into markets such as India over the next year or two.
Alden expects a more muted performance from US tech in 2026. “I think we’re finally getting to the point where the AI trade and the overall US tech trade is getting long in the tooth,” she said, adding she is “actually pretty concerned about tech stocks.” She does not forecast a crash but sees 2026 as weaker for tech than 2025.
Rising competition in the semiconductor space is a key factor. Alden said Nvidia may no longer be the “only game in town,” with Google’s chips gaining traction. She previously viewed Alphabet as a laggard worth buying, but now considers that trade largely played out after recent gains.
Alden believes investors may shift capital into markets that lagged this year. “India has been a laggard this year. I am somewhat more optimistic about India next year,” she said, suggesting 2026 could be a better year for Indian equities. Her earlier concerns centered on high valuations in India, and she still sees selective opportunities across global sectors—for example, she is “less bearish on financials in the US than many others are.”
Shifting central bank policies represent a major risk. Alden noted unstable expectations around Federal Reserve rate decisions and highlighted the Bank of Japan’s surprise move toward a more hawkish stance, which pushed yields higher and weakened the yen. She expects the BoJ to become “slightly more hawkish” but warned that Japan’s high debt limits its rate-hiking room—a situation she termed “fiscal dominance.” To stabilise markets if needed, the BoJ might sell portions of its large US Treasury holdings.
Tighter liquidity in the US, combined with Japan’s policy shift, is putting pressure on parts of the global market. Alden pointed to stress in the US repo market and signs from the end of quantitative tightening as signals of strain. Those liquidity pressures are affecting liquidity-sensitive assets, including Bitcoin and other cryptocurrencies.
For the full interview, watch the accompanying video.
