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A resilient economy and rising inflation are currently shaping conditions in equity markets. However, the key source of uncertainty remains the war in the Middle East. “Leaving aside the geopolitical situation and short-term market fluctuations, several durable investment trends are nevertheless beginning to emerge,” says Thorsten Fischer, Managing Director and Head of Portfolio Management at Moventum AM.

Equity markets in the US and Europe are currently caught between opposing forces: on the one hand, resilient economic growth and strong corporate earnings; on the other, inflation, fuelled by the war in the Middle East and rising oil prices, which is weighing on consumer sentiment. “That is the broader market backdrop,” says Fischer. Yet irrespective of this environment, a number of structural investment opportunities are emerging. “What matters here is not so much the short-term market noise,” Fischer explains, “but rather which trends are likely to prove sustainable over the coming quarters and years.”

1. Infrastructure and construction
The electrification and digitalisation of the economy are dramatically increasing the demands placed on electricity grids and energy supply. In addition to climate-related investment, key drivers include the expansion of data centres and new technologies such as AI, robotics and cloud infrastructure. “Europe, in particular, also wants to become more economically and energy-independent from imports,” says Fischer. This is likely to trigger additional investment in grids, storage technologies and energy infrastructure. “Smart power” – intelligent electricity grids, power distribution and energy infrastructure – is therefore developing into a key structural investment theme. By contrast, traditional capital-intensive infrastructure, such as roads and bridges, remains more vulnerable. Although governments are launching major infrastructure programmes, rising interest rates are creating headwinds, as these projects typically require substantial borrowing and involve long periods of capital commitment.

2. AI with a focus on the value chain
In AI, the focus is shifting away from the broad AI narrative towards a more differentiated assessment of the value chain. The market is increasingly asking which business models will ultimately benefit from AI and which could instead come under pressure. Against this backdrop, technologies closely linked to physical assets are gaining particular importance, including robotics, automation, industrial digitalisation and AI infrastructure. “They benefit directly from rising investment in productivity-enhancing technologies,” says Fischer.

3. Fee income and interest margins
The financial sector is currently benefiting from several tailwinds. Persistently steep yield curves on both sides of the Atlantic continue to support earnings by strengthening banks’ net interest margins. At the same time, mergers and acquisitions activity has picked up significantly, supported by an overall favourable financing environment and the prospect of regulatory easing. For financial institutions, this translates into higher fee and advisory income. This picture is further underpinned by borrowers’ solid equity positions, which provide banks with both stability and scope for dividend payments and share buybacks.

4. Healthcare
Populations are ageing, increasing their susceptibility to illness. Healthcare therefore remains an attractive long-term investment theme, also because of the growing global burden of obesity and diabetes. This is particularly supportive of treatments in the obesity and metabolic disease segments. “In addition, the use of AI in drug discovery is helping to shorten development cycles and increase the productivity of biotech pipelines,” says Fischer. However, the sector also faces growing competitive pressure from generic and biosimilar manufacturers, which weighs on companies approaching patent expiry, as well as regulatory risks in the US.

5. Commodities and industrial metals
The theme remains attractive, supported by long-term demand drivers such as electrification, grid expansion, digitalisation and global infrastructure development. At the same time, several metals are experiencing supply deficits and low inventory levels, while strategic stockpiling by individual countries is generating additional demand.