Clashes between global powers will fuel further market swings over the coming year, according to a JPMorgan Chase & Co. survey, with developments in artificial intelligence also top of traders’ minds.
The proportion of respondents who see geopolitical tensions having the biggest impact on financial markets this year more than doubled from 2025 to 41%, the Wall Street bank’s annual electronic trading poll found. Technological innovation, such as AI advances, came second at 19%. Interest rate policy was third at 13%.
“One thing that stands out is the focus on emerging and ongoing geopolitical tensions, implying that the market may not see a quick resolution to the current state of play,” said Chi Nzelu, who heads JPMorgan’s new quantitative trading and research group. This is “tied to concerns about continued volatility. Clients are mostly concerned about the expected cost of liquidating inventory.”
The January survey of 955 institutional and professional traders from around the world provides a snapshot into their mentalities at the start of 2026, which has already seen an escalation of geopolitical tensions and a stock selloff driven by the threat of AI disrupting entire industries.
The US’s unilateral capture of Venezuelan leader Nicolas Maduro and Trump’s push for American control over Greenland took investors by surprise this year. That’s on top of other known geopolitical hot-spots such as the ongoing war in Ukraine, a fraught ceasefire between Israel and Hamas, and lingering US-China trade tensions.
Investors across asset classes are adjusting their strategies. Emerging-market funds, for example, are pouring money into Latin American countries aligned with Trump as he looks to expand US influence in the region. The dollar, meanwhile, slid after the US threatened tariffs on European nations as part of its pursuit of Greenland last month.
No asset class has seen as much volatility from this year’s headlines as precious metals. A surge to record highs driven by speculative demand came to a swift halt at the end of January, when silver suffered its biggest daily drop on record and gold plunged the most since 2013.
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Nzelu attributed the moves to heightened geopolitical tensions, potential tariffs, and a broader debate on precious metals’ “role as a store of value compared to crypto assets or fiat currencies.” He said JPMorgan had processed record precious-metal client volumes during the recent volatility.
Generative artificial intelligence is predicted to be the technology with the most influence on trading over the next three years. That’s as firms look to apply the latest AI software to gain an edge in the market. Last week, Anthropic’s release of a model that can carry out financial research fueled a slump in the shares of various services companies.
Advancements in large-language models mean human‑written materials — such as investment research and trading commentary — can increasingly become machine-readable inputs into trading systems, according to Eddie Wen, JPMorgan’s global head of digital markets.
“Generative AI is helping us bridge the gap between unstructured content and structured data,” Wen said. “We’re seeing this evolution across both the sell side and our clients.”
All survey respondents said they expect to increase their electronic trading activity. That follows a years-long trend across asset classes, even for securities that are less liquid.
Tokenized assets, meanwhile, are seen as the biggest opportunity in digital markets. It was selected by 48% of sell-side and 33% of buy-side respondents, ahead of cryptocurrencies, stablecoins and deposit tokens.
While big banks and other market participants have been experimenting with blockchain for over a decade, volumes involving tokenized assets are still tiny compared with their traditional counterparts. The idea is to make transactions and record-keeping faster and cheaper.
“Digital assets continue to attract significant interest across the market,” Wen said. “In recent conversations with clients, most indicated some intent to explore trading, custody, or financing use cases, though engagement remains selective and largely exploratory.”
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