Morgan Stanley Investment Management advises investors to maintain their holdings in high-risk assets, such as stocks, throughout the second half of 2026. The firm anticipates that the ongoing AI investment craze, coupled with robust consumer spending, will fuel sustained expansion of the US economy. With corporations ramping up investments in AI infrastructure, this will further bolster economic growth momentum. Additionally, high-income consumers, buoyed by the wealth effect, are expected to keep spending. Meanwhile, bonds have regained their appeal, thanks to their attractive yields. Considering the strong connections between emerging markets and the Asian chip supply chain, Morgan Stanley suggests opting for defensive investment options, such as real estate, infrastructure, and transportation, to achieve portfolio diversification. It also recommends keeping a close watch on the European and Japanese markets.