Markets opened the week higher following last week’s pullback, but volatility tied to oil prices and geopolitical tensions continues to cloud the outlook. Investors are reassessing how to balance risk and opportunity in an uncertain environment.
BNN Bloomberg spoke with Matt Miskin, co-chief investment strategist at Manulife John Hancock, about shifting market leadership, stretched valuations in technology and why alternative strategies are gaining traction.
Key Takeaways
- Investors are favouring infrastructure and utility-type equities for their stable earnings, lower volatility and income potential.
- Technology stocks remain expensive, with earnings growth expectations seen as overly optimistic heading into 2026.
- Mid-cap stocks are emerging as a preferred area due to stronger fundamentals and more attractive valuations than large or small caps.
- Credit markets remain stable for now, but widening spreads would signal rising economic risk and pressure on sentiment.
- Oil prices, bond yields and global economic data are key indicators that will determine whether the current rally can be sustained.
Read the full transcript below:
ROGER: Markets are starting the week in the green after last week’s pullback. They also began last week higher before geopolitical tensions and rising oil prices weighed on sentiment. Volatility remains the key theme, with investors rethinking where to find opportunity and how to manage risk.
Our next guest is watching several themes in the current market. Joining us now is Matt Miskin, co-chief investment strategist at Manulife John Hancock. Matt, thanks for joining us.
MATT: Thanks for having me.
ROGER: Last week started higher for a couple of days. This week, is there more optimism in what we’re seeing today?
MATT: We are seeing oil prices reverse and fall on the headlines this morning. For us, we’re trying not to invest based on geopolitical headlines because the situation is very fluid and can change quickly.
We’re focused on where fundamentals are stronger, and that is in infrastructure-related equities. Utility-type businesses have strong earnings growth, are more insulated from the broader economy, offer solid dividend yields and have lower beta.
We’re also using long-short equity strategies to help protect portfolios, with short exposure to areas of the market that look overvalued. In addition, multi-alternative strategies can provide diversification by relying less on broad market direction and more on reducing overall portfolio risk in a challenging macro environment.
ROGER: Where are you finding those overvalued pockets?
MATT: It goes back to where we were before this recent volatility. The technology sector in the United States still carries a relatively high price-to-earnings ratio. The AI theme is legitimate in some ways, but valuations remain stretched.
We’re also seeing earnings growth estimates that look aggressive, in the range of 20 to 30 per cent into 2026. We think that may be too high. Instead, we’re looking for areas where earnings are more dependable and realistic, such as utilities and industrials, which appear cheaper but still offer solid growth.
ROGER: Are you looking at small cap or mid cap?
MATT: We favour mid-cap. It’s often undercovered because investors tend to focus on large or small caps, but mid cap is a sweet spot. Large caps are more expensive, while small caps tend to be lower quality. Mid caps offer a balance of relatively attractive valuations and higher quality.
Industrials are the largest sector within mid cap and one of our preferred areas globally, alongside utilities. They are benefiting from strong earnings growth and are expected to remain among the top performers into 2026.
Focusing on companies with strong fundamentals, including higher returns on equity, makes sense in a market that can shift quickly.
ROGER: So mid caps offer a track record and some stability?
MATT: That’s right. Fewer companies are going public at smaller sizes because private equity and large firms often acquire them earlier. As a result, today’s IPOs are more often mid-cap companies.
That means small caps are not what they used to be, while mid caps tend to include more established companies with proven track records and profitability.
ROGER: Credit has held up through all of this?
MATT: It has, but we’re watching it closely because credit spreads are an important signal for the economy and risk sentiment.
If spreads widen significantly, that’s a concern. Right now, lower-quality corporate bond spreads are around three per cent over Treasuries, which is still manageable. If they move toward four or five per cent, that would be more problematic.
We also monitor key indicators such as high-yield spreads and initial jobless claims in the United States. Both remain relatively stable for now.
ROGER: Where would you like to see those spreads?
MATT: Current levels in the low twos to low threes are acceptable. If spreads widen further, it would signal rising stress in the system.
Public credit markets remain useful because they provide real-time signals, and so far they are not indicating significant downside risk.
ROGER: Any concerns about the labour market?
MATT: The jobs market has been mixed. Some data points, like recent job reports in the U.S. and Canada, have been weaker.
However, initial jobless claims in the U.S. remain low at around 205,000, and consumer spending is still holding up.
The trend is gradually weakening, but at a slow pace. That’s not an immediate concern, but if we saw a sharper rise in jobless claims or unemployment, it would become more problematic.
ROGER: What would signal this rally has staying power?
MATT: The market is focused heavily on oil prices. We’ll need to see where oil settles by the end of the week.
We’re also watching global economic data, including purchasing managers’ indices from the U.S., Eurozone and Japan, to gauge the strength of growth.
Bond yields are another key factor. They’ve been rising, which tightens financial conditions. If yields continue to climb, that could limit the rally.
But if economic data holds up and both oil prices and bond yields stabilize, the rally could prove more durable.
ROGER: We’ll leave it there. Matt, thanks for your time.
MATT: Thank you.
ROGER: Matt Miskin, co-chief investment strategist at Manulife John Hancock.
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This BNN Bloomberg summary and transcript of the March 23, 2026 interview with Matt Miskin 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.
