As the ongoing conflict in Iran escalates and oil prices surge, energy stocks have shown strong performance in the market. However, one investment chief is favoring a strategic shift back to Big Tech, an industry that had previously dominated but faced challenges at the beginning of 2026.
David Bianco, the Chief Investment Officer of Americas at DWS Asset Management, which manages over $1 trillion in assets, is advocating for a renewed focus on technology stocks. According to Bianco, this sector is relatively insulated from the economic disruptions caused by the unfolding war in Iran. He pointed out that capital expenditure on artificial intelligence is continuing unabated despite broader economic slowdowns. “Even if the economy is very slow, this investment spending on data centers is going to continue, and these tech companies are committed to developing their AI-oriented businesses,” Bianco stated in a recent conversation with Business Insider.
Bianco highlighted that tech stocks like Nvidia and Microsoft are currently trading at discounted valuations compared to the S&P 500, making them attractive investment options. “I think it’s time to get back to tech stocks and appreciate the secular strength of their earnings,” he asserted.
In contrast, Bianco expressed skepticism about the long-term viability of energy stocks, despite the rise in crude oil prices. He underscored his underweight position in energy, noting, “Sure, it’s attractive over the short term and may go higher over the short term, but unless you believe this crisis is going to last for a very long period, I have a tough time chasing energy stocks.”
Bianco also revealed a cautious outlook regarding several sectors tied to economic cycles. He has increased his underweight positions in transportation, consumer discretionary, housing, and automotive-related sectors—as well as early-cycle industrials. His economic perspective is shaped by the inflationary pressures stemming from the conflict and the anticipated sustained high levels of spending deficits.
With interest rate cuts seeming unlikely, Bianco projects that the 10-year yield will remain above 4%. This context leads him to doubt a near-term recovery in housing and automotive markets. He remarked, “Whether it be stimulus, One Big Beautiful Bill, or interest rate cuts, this idea that by the spring, housing and auto and the broader consumer and broader manufacturing investment spending would improve, I think that’s been put on a longer hold.”
