Uncertainty about Dominance vs
The most important stock indexes in the world are approaching their highest level ever. The paradox is striking: how can the markets continue to rise if the economy is burdened by geopolitical tensions, high interest rates and trade or territorial wars?
The statement is in one word: profit. In the United States, the large tech companies have seen their profit per share rise by 500% in five years. But the trend is not limited to the Magnificent 7: the rest of the American market, as well as the international and European shares, also show increases from +80% to +110%. The profit dynamics is certainly a fact.
Expect the markets According to Kevin Thozet, member of the investment committee at Carmignac Again a strong results season in the United States and are less optimistic over other countries. “However, be careful with good news! Five years ago, already the consensus that the US would dominate in the field of profit growth. The opposite happened, however, if we ignore the largest tech shares.”
Various indicators are currently indicate that the cards will be shaken again, Thozet emphasizes. He points out that Germany comes with more and more plans for government investments, in particular in the field of infrastructure. Thozet is also optimititically about Asia that increasingly shows signs of recovery. “The visitor numbers of the casinos in Macau have risen by 20%, the Chinese real estate prices are in the elevator and the authorities are inclined to breathe new life into the activity.”
The United States, on the other hand, could end up in a dip, says Thozet. “The effects of the protectionist measures are already noticeable, while the positive impact of government spending is only expected in 2026. And because the FED is more watchful than ever with regard to tensions on the labor market, monetary support will be limited.”