Federated Hermes' Private Markets 2026 Outlook reveals that deal activity is gaining positive momentum following interest rate normalization in H2 2025, positioning private asset classes to deliver greater capital distributions from older vintages—which should fuel new allocations toward specialist strategies rather than generalist, diversified approaches.

Political risk has emerged as the single greatest threat to global investing, surpassing traditional market concerns like valuations or economic cycles. Conni Jonsson, Founder and Chairperson of EQT, addresses this challenge head-on in the Alt Goes Mainstream podcast's DNA series, arguing that geographic diversification represents the only viable mitigation strategy in an increasingly unstable political environment.

European private equity deal value dropped 10.5% quarter-over-quarter in Q2 2025 as sponsors worldwide hit the pause button following US President Donald Trump's tariff announcements in April. According to PitchBook's European PE Breakdown, the market showed resilience in deal count, which rose 3.1% QoQ, thanks to a pickup in activity toward quarter-end as European central banks maintained monetary easing trajectories.

Blackstone's President and COO Jon Gray warns that while current tariff-induced uncertainty creates short-term market volatility, the real transformation lies in artificial intelligence reshaping entire industries and driving unprecedented demand for data infrastructure.

Artificial intelligence will trigger the biggest wave of defaults in private credit history as thousands of software companies fail to transform into AI-first businesses, warns Bruce Richards, CEO of Marathon Asset Management. Richards predicts that software sector default rates will triple over the next five to seven years, forcing his $24 billion credit-focused firm to halt all software lending until companies prove they can navigate the AI transition.

Despite a slowdown in private markets over the past three years, Schroders Capital's Q2 2025 outlook suggests valuations and yields are now attractive, though significant risks remain from US policy changes affecting trade, immigration, and ESG priorities.

Geopolitical economic tensions create unprecedented market uncertainty, but private capital growth remains unstoppable with wealth clients