2026 Market Outlook: 3 Top Sectors to Watch Amid Global Tensions

Even though the world’s economic and political environment remains unsettled, there are solid growth opportunities for global investors. A series of recent actions by the United States has reshaped expectations for world trade and corporate strategy. Early in January 2026, the U.S. military operation in Venezuela sent shockwaves through global markets. This directs to renewed U.S. willingness to engage directly in geopolitical flashpoints, a clear inflection point for trade linkages in the energy sector.

In addition, the United States sharply expanded its pressure on Iran by proposing a 25% tariff on any country that trades with Tehran, a move that could affect Iran's regional trade links and infrastructure projects such as the strategic Chabahar Port. 

At the same time, renewed U.S. attention on Greenland has underscored its growing strategic importance, particularly due to its location and access to critical minerals. While proposals related to Greenland have been firmly rejected by local and Danish authorities (TIME), the episode highlights how geography and resource security are increasingly shaping geopolitical priorities rather than signaling any immediate economic or investment outcome.

Together, these incidents mean investors need to look beyond short-term headlines and focus on sectors driven by long-term demand and innovation. Going by the World Bank’s January 2026 release, global growth is expected to remain broadly steady over the next two years, easing to 2.6% in 2026 before rising to 2.7% in 2027. This reflects resilient activity despite continued trade uncertainty and geopolitical tensions.

Here, we present three sectors where growth investors can find sustained opportunities in 2026, supported by long-term demand, capital investment and structural shifts in the global economy.

3 Areas Likely to See Strong Growth in 2026

Energy Transition and Power Infrastructure: As countries opt for decarbonization while prioritizing baseload energy reliability, the renewable energy and power infrastructure sector is positioned for sustained structural expansion, increasingly shaped by the evolving international trade environment. Rising trade tensions, supply-chain disruptions and geopolitical risks have pushed governments to reduce dependence on imported fuels and vulnerable energy routes, accelerating investment in domestic and allied-sourced power generation. At the same time, the reshoring and friend-shoring of manufacturing, data centers and critical industries are driving higher local electricity demand, reinforcing the need for robust grids and reliable power systems.

Investment momentum is therefore being driven by the strategic need to support data centers, electric vehicles and industrial electrification. In 2026, the outlook remains strong as utilities and governments continue allocating capital toward scalable, cost-competitive energy solutions that enhance energy security and trade resilience. NextEra Energy NEE is expected to benefit from its scale in renewable generation and regulated utility operations, offering both growth and earnings visibility. GE Vernova GEV, through its exposure to wind turbines, grid equipment and power systems, is well positioned to benefit from global infrastructure upgrades and rising demand for reliable power amid shifting trade and supply-chain priorities. While NEE carries a Zacks Rank #2 (Buy), GEV carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oil & Conventional Energy: Oil and conventional energy remains a strategically important sector in 2026, closely linked to the current international trade and geopolitical environment. While the long-term transition toward cleaner energy continues, oil remains critical for transportation, petrochemicals, aviation and as a stabilizing source of baseload energy during periods of supply disruption. The ongoing geopolitical tensions, sanctions and conflicts affecting major producing regions have strengthened the importance of secure oil supply chains and diversified sourcing. As global trade routes face uncertainty, many countries are prioritizing energy security, strategic reserves and long-term supply contracts to reduce exposure to volatility in international markets.

In 2026, capital discipline among oil producers, combined with steady global demand, supports a positive outlook for the sector. Integrated energy companies benefit from diversified operations across upstream, refining and trading, allowing them to navigate price swings and trade disruptions more effectively. Companies such as Chevron CVX are well-positioned, banking on their scale, strong balance sheets and global asset bases. CVX carries a Zacks Rank #3.

Defense & Security: The defense sector is currently the center point of the global economic and trade environment in 2026, as rising geopolitical tensions and shifting alliances reshape national priorities. Escalating conflicts, renewed great-power competition and instability in key trade corridors have led governments to view defense spending not only as a security necessity but also as a strategic investment. Trade disruptions, sanctions and supply-chain vulnerabilities have pushed countries to strengthen domestic defense manufacturing and deepen procurement ties with trusted allies, reinforcing long-term demand for military equipment, technology and services.

In 2026, the outlook for defense remains structurally strong, supported by elevated and sustained defense budgets across the United States, Europe and parts of Asia. Spending is increasingly focused on advanced systems such as aerospace, missile defense, cybersecurity, surveillance and unmanned platforms, rather than short-cycle procurement. Large, diversified defense contractors benefit from long-duration government contracts, high barriers to entry and predictable cash flows. Companies such as Lockheed Martin LMT are well-positioned to benefit from this environment, given their exposure to next-generation defense systems, global order backlogs and their role in supporting allied defense and security frameworks amid an evolving international trade and geopolitical landscape. LMT holds a Zacks Rank #3. 

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