This report assesses the 2026 private credit space by examining these four key private credit risks: valuation opacity, liquidity constraints, credit risk, and AI disruption. In addition to evaluating the large price divergence between Alternative Asset Managers and the S&P 500, it investigates how semi-liquid fund withdrawal restrictions affect that price difference.

Our view: Thermo Fisher Scientific is an end-to-end pharmaceutical and life sciences tools provider, pursuing value-chain expansion through acquisitions and increased exposure to data analytics. In late 2025, the company announced partnerships with NVIDIA and OpenAI to integrate AI into key laboratory instruments.

Our view: The market’s valuation of Texas Instruments is distorted by a GAAP-based “gross CapEx” view that treats its ~$5.0B annual capital expenditure as fully shareholderfunded, while ignoring substantial, non-dilutive government support under the CHIPS Act. In reality, direct grants and refundable Section 48D tax credits cover an estimated 40–50% of project costs, lowering TI’s effective capital intensity from ~33% of revenue to the low-20% range

Our view: We believe the market underestimates Rheinmetall’s rapid expansion that will drive up the sales, while simultaneously increasing or keeping the net margins. It also overestimates Rheinmetall’s credit risk due to its high debt and Moody’s rating.

Our view: We’re going long Nestlé because the market is currently pricing it like a slow-moving defensive while missing near-term catalysts that can re-rate the stock. Recent weakness looks largely technical and sentiment-driven, not fundamental, and we think that disconnect creates an attractive entry.

Global macro conditions this week were defined by a broad decline in bond yields across the United States, Europe, and parts of Asia, signalling that markets are increasingly positioning for a softer growth environment and potential monetary easing later in 2026. The lows in long end yields was synchronized across regions, suggesting a global repricing of rate expectations rather than a localized shift. Despite this adjustment in the rates market, economic activity remains stable.

Following the 2008 financial crisis regulators had to enforce new rules on how banks originate and service new loans to the consumers. During that time there were items in the balance which appeared profitable during good times but quickly turned sour during the crisis. Mortgage Service Rights (MSRs) seemed to be one of the main catalysts that deteriorated their balance sheets and imposed serious liquidity risks for these banks. Basel III rules introduced in 2013 were supposed to change this narrative.

The Nikkei 225, Japan’s benchmark equity index, surpassed 57,000 points on February 9. The rally followed the landslide victory of Prime Minister Sanae Takaichi’s Liberal Democratic Party (LDP) in the February 8 general election.

Inventory Dynamics and Growth Outlook in European Luxury This week’s European luxury sector continues to show elevated inventory alongside modest sales growth, suggesting the sector is in a gradual inventory normalization phase. As of late 2025/early 2026, LVMH's inventory days were approximately 305 to 310 days, representing a modest improvement from approximately 334 days the previous year, indicating better stock management, but turnover remains slow. This could reflect possible weak demand, strategic scarcity, or leftover luxury inventory.

This week, the European credit market has exhibited fragile stability despite a surge in arbitrage-driven bond issuance, raising questions about whether this resilience reflects underlying strength or growing risks within non-bank financial intermediaries (NBFIs).

Lumber futures continue to hold above $595 per thousand board feet after rebounding from an early January dip, as tightening supply met seasonal demand. Looking at the fundamentals of price formation on the demand side, we largely consider North American housing construction; lumber consumption is highly elastic to new housing projects, renovation activity and mortgage conditions. Therefore, changes in interest rates impact futures prices directly through reducing forward demand expectations. The NAHB/Wells Fargo Housing Market Index (HMI) revealed that current sales conditions declined one point to 41 points, similarly, sales expectations and traffic of prospective buyers fell in January 2026.

LNG has in recent years shifted to a structural pillar of European gas security and geopolitical exposure across the region. The post Nord stream realignment of supply away from pipeline dependence has driven an expansion of import capacity, a surge in spot market activity, and deeper integration with global LNG trade dynamics. Europe is now expected to import record volumes, around 185 bcm (billion cubic meters) in 2026, supported by expanding global supply and diversification policies.