Jonathan Reedwell on 2026 Market Volatility: 3 Defensive Equity Strategies for the AI Reset

New York, USA (PinionNewswire) — Global equity markets are facing a defining moment as the “AI Loser Trade” gains momentum, driving a sharp rotation out of hyper-growth tech stocks into defensive sectors. Amidst this backdrop of heightened volatility—with the VIX climbing over 4% today—Jonathan Reedwell, Senior Equity Fund Manager at Ofek Kesef Asset Management, urges investors to look beyond the immediate panic selling and focus on structural cash-flow resilience.

The Macro Nexus: Tech Sell-Offs & Equity Strategy

The decoupling of AI capital expenditure from immediate revenue realization has triggered a massive revaluation event. Over the past 48 hours, a wave of anxiety regarding “overinvestment” by major tech conglomerates has caused the Nasdaq to shed significant value, while capital flows are moving aggressively into dividend-yielding sectors like utilities and financials.

Current market data highlights a precarious balance:

• Capex Concerns: Hyperscaler capital expenditure plans have ballooned to $660 billion, sparking fears of margin compression across the software ecosystem.
• Rate Reality: With the Federal Reserve holding interest rates steady at the 3.50%–3.75% range in early 2026, the cost of capital remains a tangible constraint for growth-dependent companies.
• Sector Divergence: While tech stumbles, European and Asian markets are showing resilience, particularly in banking and industrials, driven by “Goldilocks” macroeconomic data suggesting sustained but moderate growth.

Expert Insight: Addressing the Volatility

Drawing on his background in quantitative modeling from Wharton and portfolio management at BlackRock, Jonathan Reedwell identifies this volatility not as a crash, but as a “rationalization of valuations”. The market is effectively punishing companies with high price-to-earnings multiples that lack immediate cash flow visibility.

What is the projection for Equity Strategy in 2026?

According to Reedwell, the trajectory indicates a shift from “growth at any cost” to “growth at a reasonable price” (GARP). Investors should anticipate:

• Multiple Compression in Software: A continued repricing of pure-play software stocks that cannot demonstrate immediate AI-driven revenue uplifts.
• Resurgence of Value Factors: Companies with strong balance sheets and consistent dividend payouts will likely outperform as volatility persists through Q2.
• Active Management Premium: Passive indexing may suffer as the divergence between winning and losing sectors widens; active selection will be critical to avoiding “value traps”.

Identifying the Structural Risks

While the broader economy avoids recession, the risk of “Capex Indigestion” remains high. Reedwell notes that if AI adoption rates fail to match the $660 billion infrastructure spend, a second wave of repricing could hit semiconductor and hardware stocks by mid-year. This necessitates a risk management framework that prioritizes liquidity and low leverage.

Future Outlook: The 6-Month Horizon

Looking ahead, the equity landscape is expected to stabilize as the market digests the Federal Reserve’s “higher for longer” stance and the reality of corporate earnings catches up to valuation expectations. The focus will likely shift toward “Old Economy” sectors—energy, infrastructure, and financials—that are modernizing through technology without carrying the valuation premium of pure tech plays.

For Jonathan Reedwell, the path forward relies on the same principles of prudent asset allocation and long-term value that defined his tenure at major global institutions: remaining disciplined when the market is reactive.

Media Contact Information

Jonathan Reedwell

Ofek Kesef Asset Management

[email protected]

http://www.ofekkesef.com