Market leadership could widen in 2026 after several years dominated by a narrow group of sectors and stocks. Lower interest rates, rising fiscal spending and shifting valuations are setting the stage for a more cyclical equity environment across regions and asset classes.
BNN Bloomberg spoke with Lesley Marks, chief investment officer, equities at Mackenzie Investments, about the firm’s 2026 outlook and why diversification beyond U.S. megacap technology could become increasingly important for investors.
Key Takeaways
- Market leadership in 2026 is expected to broaden globally after several years of returns driven by a small group of dominant sectors and stocks.
- Falling interest rates and strong fiscal spending are setting up a more cyclical equity market, benefiting areas that have lagged in recent years.
- Heavy concentration in U.S. megacap technology could weigh on index performance as earnings growth slows and capital spending increases.
- Canada and international markets may benefit from commodities, improving earnings in Europe and attractive valuations in emerging markets.
- Diversifying across regions, sectors and commodities could help investors reduce concentration risk and capture new sources of growth.
Read the full transcript below:
LINDSAY: Mackenzie Investments has released its outlook for next year, saying it expects market leadership to broaden, with more countries driving growth. Our next guest says investors should diversify beyond the U.S. if they are overly concentrated there. Let’s get more from Lesley Marks, chief investment officer, equities, at Mackenzie Investments. It’s good to have you with us. Thanks for joining us.
LESLEY: Thank you for having me.
LINDSAY: You’ve said investors should diversify beyond the U.S. if they are mostly concentrated there. Why is that?
LESLEY: First of all, because the U.S. has been one of the top-performing markets over the past few years, it’s natural that investors would have a higher allocation there. We think that has also allowed investors to ignore what’s happening in other parts of the world. When you look at other markets, you get diversification because they are more than just technology, which has been the primary driver in the U.S. So it’s not just diversification by region, but also by sector and exposure that comes with looking at other areas of the world.
LINDSAY: Let’s start with regions and then move into sectors. Which markets do you like right now outside the U.S.?
LESLEY: This may surprise some people, but the U.S. has not been the top-performing market year to date. In fact, it has lagged much of the developed world, particularly when you look at returns in Canadian dollars, which is most relevant for Canadians. That said, technology has still been a key driver of returns. Closer to home, another major driver has been the gold sector. For investors looking to diversify into commodities, whether that’s gold, base metals or even areas like natural gas and uranium, Canada is a very attractive place to look for diversified returns.
LINDSAY: You touched on sectors there. For investors looking to diversify away from technology, are there other areas they should be watching in the new year?
LESLEY: One of the big themes we’re seeing globally is a strong fiscal impulse, meaning significant fiscal support for economies. We’re seeing that in Europe, Canada and the United States. That is likely to lead to a capital-spending cycle, or a reflation trade, that supports economic growth. In that context, industrial sectors should benefit. We also think returns will continue to broaden beyond the megacaps. Over the past few years, most of the earnings growth came from the top 10 companies in the S&P 500. Now we’re seeing smaller companies start to catch up, while the relative growth of the largest companies begins to slow. That could push investors toward companies outside the top 10, including U.S. small- and mid-cap stocks.
LINDSAY: I’ve heard that theme around small caps a few times today. Do you think 2026 could be a bigger year for small- and mid-cap stocks?
LESLEY: I’ll admit we thought 2025 would be the year for U.S. small- and mid-cap stocks. We expected deregulation and consolidation to be major drivers. Those factors are still important, along with onshoring and aspects of the One Big Beautiful Bill Act, which tend to favour more domestically oriented small- and mid-sized companies. We continue to believe this trend will play out in 2026, even though it’s taken longer than we initially expected.
LINDSAY: You mentioned gold in Canada earlier. Do you also expect other critical minerals, such as copper, to drive Canada’s growth?
LESLEY: Copper has very strong fundamentals. In simple terms, there is a notable increase in demand without a comparable increase in supply. That makes the supply-demand backdrop very attractive. Copper is used across many types of infrastructure, but a key focus right now is the capital spending tied to data centre buildouts globally. Interest in base metals should continue to build throughout this capital expenditure cycle.
LINDSAY: Many Canadian mining companies could benefit from that. What’s your outlook for the broader business environment in Canada in 2026?
LESLEY: Canada is a bit tricky. The first thing to say is that the economy is not the same as the stock market. There are factors that can support the Canadian equity market even as the broader economy faces challenges. A large part of our economy is tied to housing, and we continue to see data showing that housing is softening, whether in prices or transaction volumes. That creates headwinds for economic growth. On the other hand, there is a strong fiscal impulse, with governments focused on infrastructure, shovel-ready projects and mining developments. These are capital intensive and create jobs. So there is a push and pull in the Canadian economy. Canadians have also benefited from stronger markets through a positive wealth effect, but a more sustained economic improvement will likely depend on stabilization in the housing sector.
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This BNN Bloomberg summary and transcript of the Dec. 15, 2025 interview with Lesley Marks are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
