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TIMOTHY A. CLARY \/ AFP via Getty Images <\/p>\n
2025-12-04T15:39:40.895Z<\/p>\n
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Facebook Email X<\/p>\n LinkedIn<\/p>\n Reddit<\/p>\n Bluesky<\/p>\n WhatsApp<\/p>\n Copy link<\/p>\n lighning bolt icon Impact Link<\/p>\n Save <\/p>\n Read in app<\/p>\n <\/a> <\/p>\n This story is available exclusively to Business Insider As the year winds down, finance pros are scanning the horizon for signals of what 2026 may hold. ‘Tis the season for year-ahead outlooks on Wall Street as 2025 winds down, and Apollo Global Management’s top economist is eyeing a handful of key risks to the outlook for markets and the economy. <\/p>\n Torsten Sl\u00f8k, chief economist at Apollo Global Capital, sees five primary market risks for 2026 that he thinks investors should be focused on.<\/p>\n Sl\u00f8k laid out his team’s top five upside and downside scenarios in a December 4 note. Here’s what he’s watching for. <\/p>\n The US economy resumes upward momentum. Sl\u00f8k has said recently that he thinks economic growth is likely to pick up again in 2026, as risks from the trade war are fading and the One Big Beautiful Bill Act (OBBBA) is likely to boost demand. <\/p>\n The risk in this scenario is that stronger economic growth creates new inflationary pressures. Prices resuming their climb would be a problem for markets, as investors’ bullish thesis revolves around the Fed continuing to cut rates, which it would be less willing to do if inflation spikes again. <\/p>\n A global manufacturing upswing drives more growth. Sl\u00f8k thinks the rest of the world will see renewed growth in 2026, too. He added that the global economy will likely benefit as manufacturing increases and nations continue investing in their industrial bases.<\/p>\n “The global industrial renaissance boosts global growth with more and more countries focusing on homeshoring advanced manufacturing capacity, investing in infrastructure, energy, defense and supply chains,” he predicted.<\/p>\n The new Fed chief politicizes monetary policy. Rate cuts have been at the heart of market outlooks all year, with arguments over whether the Fed should keep cutting or remain cautious to avoid aggravating inflation. However, markets have mostly been united in their disdain for the administration’s meddling in monetary policy. Trump’s prior attempts to influence Chairman Jerome Powell have been met with swift sell-offs in stocks and bonds.<\/p>\n However, Sl\u00f8k sees a significant risk that the new appointee<\/a> to run the central bank\u2014most likely top White House economist Kevin Hassett\u2014will lower interest rates “purely for political reasons,” a decision that could cause inflation to surge even higher and spark a need for more aggressive rate cuts later on, making the outlook for stocks much less bullish. <\/p>\n
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\n Apollo chief economist Torsten Sl\u00f8k sees five risks to markets and the economy.
\n He thinks the US economy will likely reaccelerate, potentially stoking fresh inflation. <\/p>\n