Goldman Sachs says stick with Asia's winners, keep diversifying into commodities

Asian stocks still have room to run even after a blistering first-half rally, while investors should continue diversifying into commodities as geopolitical shocks reinforce long-term demand for metals and energy infrastructure, Goldman Sachs said. The Wall Street bank highlighted that the same structural themes driving Asia's equity outperformance — artificial intelligence, power infrastructure and defense spending — are also strengthening the case for commodities, particularly copper and gold. In its second-half Asia equity outlook, Goldman urged investors to "stick with the winners," arguing that earnings growth, rather than valuations, remains the dominant driver of markets. The bank retained an overweight recommendation on North Asia, favoring South Korea, Taiwan, Japan and China's domestic A-share market, alongside technology hardware, capital goods and banks. "The semiconductor memory supercycle is one of the most powerful and prominent themes that is still not fully priced," the bank's experts wrote. Goldman expects the MSCI Asia Pacific ex-Japan Index to deliver mid-teen returns in the second half, supported by projected earnings growth of 60% in 2026 and 22% in 2027. …