2026 to Boost Earnings; IT, Consumption, Materials are 'Dark Horses': ABSL AMC

• ABSL AMC's Harish Krishnan predicts improved earnings growth in 2026, shifting focus to selective, company-specific bets.
• Krishnan cautions against over-owned small caps, advocating for greater opportunities in large-cap companies due to stretched valuations in smaller firms.
• Key tailwinds for 2026 earnings include monetary easing, fiscal support for consumers, and stabilizing currency trends benefiting dollar-linked revenues.
• High equity supply from IPOs, OFS, and QIPs is capping market returns, leading ABSL AMC to significantly reduce IPO participation.
• IT, consumption, and materials are identified as "dark horse" sectors with potential for alpha, while industrials and capital goods are being de-risked.

Why It Matters: ABSL AMC sees 2026 as an earnings-led cycle, favoring large caps and specific sectors like IT, consumption, materials.