The chief strategist at $5.7 trillion State Street shares 4 trades investors should pile into right now

• State Street's Michael Arone maintains a bullish market outlook despite recent economic turmoil.
• His firm has upgraded technology, energy, and materials stocks to overweight positions.
• Arone also highlighted real assets like gold as beneficiaries of deglobalization trends.

At the start of 2026, Michael Arone was one of the most bullish strategists on Wall Street, calling for the S&P 500 to rise 17% to 8,000. Things have changed quite a bit since January (see: surging oil prices, inflation fears, and AI threatening to upend entire industries), but Arone is sticking with his rosy outlook.

"I think that the market is like a spring right now, and that spring is kind of coiled, and you can see it really wants to move higher," Arone, State Street Investment Management's chief investment strategist, told Business Insider.

He pointed to a handful of factors he thinks will push the market higher:

• The US-Iran conflict is likely to be resolved soon
• The tax cuts in the One Big Beautiful Bill Act and other fiscal stimulus will provide a tailwind to growth
• Average tariff rates have come down to around 8% since the Supreme Court IEEPA ruling in February
• Inflation is likely to stay low as a low labor market quits rate implies suppressed wage growth, teeing up the Federal Reserve to cut rates later this year
• The FIFA World Cup should boost earnings a bit in the US as consumers spend on hotels, tickets, food, merchandise, and more

But Arone said a few new opportunities have opened up since the start of the year, leading State Street, which oversees $5.7 trillion in assets, to upgrade them to overweight in recent days.

4 trades State Street is overweight on

The first is technology stocks, which now trade at a lower premium while driving much of the market's earnings growth. Plus, he argues they're more protected from geopolitical volatility and a potential economic slowdown than other areas of the market.

"In many ways, technology is somewhat insulated from some of those dynamics and is delivering exceptional earnings and revenue growth, and I can buy that growth at essentially a market multiple," he said.

Second is the energy sector, which Arone argues had fundamental growth drivers behind it even before the US-Iran war sent oil prices soaring. Those bullish trends include an expected economic recovery cycle, expected lighter regulation, greater capital discipline from firms in the industry, and AI innovation.

Plus, their valuations are cheaper now.

"The stocks were already starting to rally prior to the conflict breaking out, and now all of a sudden at higher oil prices, their revenue outlook just got a whole lot better, and they're trading at a far cheaper multiple than the market," he said.

Third are materials stocks. Arone said they should continue to get a boost from a trifecta of factors: increased defense spending, AI infrastructure spending, and geopolitical tensions driving governments to take a national interest in certain materials. Earnings in the sector are growing 24% year over year, he said.

Finally, Arone said he's bullish on real assets like gold as deglobalization accelerates and government spending and debt grow. The firm had already been overweight on the trade, but Arone said that the US-Iran war only bolsters their view.

"That spending that they're all doing is also increasing the level of debt at a time when many of them can ill afford to expand their poor fiscal positions — Germany, Japan, the US, etc. And so they're debasing their currencies," he said. "All of this leads us to want to own more real assets.