By leon
Excluding NVIDIA from the S&P 500 reveals that European stocks have performed on par with their U.S. counterparts since the start of the current bull market in October 2022. As the old saying goes, “If you torture the numbers enough, they’ll eventually give in.” This graph’s narrative, however, hinges on the careful choice of starting … Continued
By leon
A fascinating study by Citigroup on the rise of AI-powered robots and humanoids ( Citi GPS – The rise of AI robots – Dec 24 ) predicts that over 1.3 billion AI-driven robots will inhabit the Earth by 2035, with this number soaring to 4 billion by 2050. Key applications are expected to include autonomous … Continued
By root
The higher valuations of U.S. equities are largely driven by a clear advantage in profitability, both compared to their own historical levels and to European counterparts. Over the past decade, S&P 500 companies have boosted their return on equity (ROE) by approximately 5%, now standing over 4% higher than that of major European firms.
By root
Philips shares dropped 17% yesterday following third-quarter results that fell short of expectations, prompting the company to lower its full-year comparable sales forecast. Management cited weakness in the crucial Chinese market, which accounts for 7.7% of 2023 sales, due to low consumer confidence and an ongoing anti-corruption campaign affecting the healthcare sector. We see the … Continued
By root
The IMF has released its updated economic growth forecasts for 2025, projecting global real GDP growth to hold steady at 3.2%. While growth is expected to moderate in both China and the U.S., the latter is likely to remain the world’s primary economic driver. Among the major economies, only India and China are expected to … Continued
By root
One of ECP’s five key quarterly investment themes highlights the United States’ dominant role as the primary driver of the global economy. Today’s graph illustrates this perspective by comparing GDP growth and key leading indicators—Manufacturing and Services PMIs—for both the US and Europe. Two key takeaways emerge. Firstly, the US GDP continues to expand, while … Continued
By root
As the Q3 earnings season progresses, the overall results have been robust, particularly in the technology sector. While there are notable exceptions, such as ASML in Europe, companies like SAP have posted impressive results, largely driven by strong cloud sales. Tesla, often regarded as a tech company, also significantly outperformed expectations. These outcomes reinforce … Continued
By root
The soaring national debt of $36 trillion, coupled with rising interest rates, is costing the U.S. government dearly. Currently, it pays a staggering $1.2 trillion annually in interest alone, based on a 12-month rolling average. This amounts to roughly 23% of all federal revenue from taxes, tariffs, and fees. At this point, printing more money … Continued
By root
Goldman Sachs analysts project a 72% likelihood that the S&P 500 will underperform bond markets over the next decade. In their baseline scenario, they anticipate a modest 3% annualized return, barely outpacing inflation. Goldman attributes this drag in returns to the market’s current high concentration. At ECP, we remain committed to our strategy of selecting … Continued
By root
Despite the German government’s decision to shut down nuclear capacity and the Fukushima nuclear disaster, the demand for nuclear power has not waned. In fact, nuclear energy generation is surging to new heights, driven by the growing energy needs of emerging technologies like AI. At this point, a world without nuclear power is nearly unimaginable, … Continued