ANNE ASHWORTH reveals her high US shares to beef up your portfolio

Sell in May and go away’ used to be a stock market adage. But not only has this advice become outdated – it has been replaced in 2026 with very different guidance.

Bank of America thinks we should be ‘stocks-maxxing’ this month, snapping up US shares to make the most of an artificial intelligence-fuelled upswing.

Other names favouring US stocks over their global peers include Wall Street titans Blackrock, Citigroup and the broking arm of HSBC.

Despite rising hopes for a US-Iran peace accord, stocks-maxxing could be the most dangerous investing trend of the summer, as inflation and higher energy costs would continue to pose a threat to the US economy. Yet it could also be a lucrative proposition for those prepared for significant risk.

Lale Akoner, global market analyst at brokers eToro, comments: ‘I still think the US remains the most compelling equity market globally – for selective exposure and risk management, not blind momentum chasing.’

Here’s why experts say you should buy, not sell, this May… and how to proceed with care.  

THE BOOM LOOP

Bank of America strategist Michael Hartnett argues the US economy is in a ‘boom loop’, being driven higher in dollar terms by surging corporate revenues, wage increases, government spending and technology companies’ prodigious investment in AI.

Forecasts for this expenditure have been revised up again, with Morgan Stanley now expecting $800bn this year, against its earlier estimate of $765billion.

Next year the figure could be $1.1trillion, up from the $950billion predicted not long ago, although there is as yet no guarantee of any payback from this spree.

These predictions will deepen the apprehension of those who argue a downward spiral, or ‘doom loop’, is the logical consequence of war in Iran – and overvaluation of tech shares.

Yet, apparently oblivious to these concerns, the S&P 500 US stock market index hit a record high of 7,401 this week, as did the tech-heavy Nasdaq, which touched 26,218.

THE GUNG-HOs VS THE OH-NOs

The most recent US gross domestic product (GDP) report showed growth of 2 per cent for the first quarter – lower than the expected 2.2 per cent.

But billionaire New York fund manager Bill Ackman, boss of Pershing Square Management, thinks AI spending will support the economy in the second half of this year.

Also providing a boost, he says, will be the One Big Beautiful Bill Act – President Donald Trump’s tax and welfare cuts that also raise investment in energy and other projects.

Ackman’s confidence is based on a relatively rapid resolution to the war. He describes the conflict as a ‘weeks, but not many months phenomenon’, after which oil prices would begin to subside, lessening inflationary pressures.

Warren Buffett, the legendary founder of the $1trillion Berkshire Hathaway fund, takes an opposite stance, observing that ‘prices for an awful lot of things will look very silly’. Berkshire Hathaway has a $397billion cash pile, but does not seem minded to splash this on stocks-maxxing.

THOSE TO SELL

The disconnect between the soaraway performance of the indices and anxiety over the state of the economy may tempt some investors to ‘sell in May and go away’, a practice followed in the 19th and 20th centuries in the US and the UK.

May, June, July and August were for socialising, not investing. In the US, some Wall Street types did not return to their desk until October. In Britain, share dealing resumed at the time of the St Leger horse race in September. The intervening period was spent at events like Ascot, Wimbledon, Henley Regatta and Cowes. In the UK, selling in May sometimes makes sense. In 24 of the 50 years since 1976, there has been a summer correction in the MSCI UK index, according to a study from Bestinvest Evelyn.

But, as Jason Hollands of the finance firm adds, the market has not fallen during any summer this decade. Since 1976, the S&P 500 has declined in just 16 of the intervening years.

NEW TECH NAMES

You may already be, unwittingly, stocks-maxxing in the US tech sector. Many global funds have stakes in the Magnificent Seven of tech – Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla.

If you are attracted to this sector, look at less familiar companies playing a role in the AI revolution, such as microchip maker AMD, which is rated a ‘buy’ at $445, a rival to the semiconductor behemoth Nvidia, run by Jensen Huang. Another is Teradyne, which tests microchips once manufactured. Its shares are considered a ‘buy’, and were $363 yesterday.

There is also a focus on the firms that produce the memory elements of microchips. One key specialist is Micron. Its shares have soared by 757 per cent over the past 12 months to $730, but are still considered a ‘buy’.

Before committing, it’s worth noting that, as Akoner puts it: ‘This is the point in the cycle where enthusiasm can run ahead of what can realistically be delivered. Investors should not confuse a transformational story with a guarantee every asset will deliver attractive returns.’

BUT IT’S NOT THE ONLY STORY…

Reorganising the US part of your portfolio, rather than stocks-maxxing, may make sense if you have money in index funds that track the S&P and should give exposure to all sectors.

Tech stocks make up 35 per cent of the S&P 500 and so constitute the same proportion of an index fund under the ‘weighting’ rules of these vehicles. This would leave you vulnerable to a tech share sell-off.

‘Equal weight’ index funds are an alternative, as these hold the same amount of every constituent company and so provide greater downside protection.

Hollands says: ‘Among options are the Legal & General S&P 500 US Equal Weight Index fund and the Shares S&P 500 Equal Weight Index exchange traded fund.’

It could pay off to look beyond Silicon Valley as optimism spreads to other sectors.

Hollands suggests the Dodge & Cox Worldwide US Stock fund, which has a range of holdings.

Pershing Square Holdings, Ackman’s FTSE 100 investment trust – one of my US picks – ventures into other industries. Its portfolio contains Alphabet, the Google group, but also Hertz and Dutch-American Universal Music – home to Taylor Swift and a firm for which Ackman is bidding. America’s main business may be technology, but show business should not be forgotten.