The market has behaved, once again, celebrating the published results, neither Trump nor geopolitics have been able to with a strength of results that surprise everyone and everyone. There are two main reasons, first that many companies have shown significant increases in their margins and second that the strong investment in CAPEX has “watered” many other companies in different sectors, mainly Industrial and technological.
That is the key to this sweet moment of results, and the key to the future behavior of the markets. The effect on the results is being very powerful but these investments will not last forever, it is necessary to verify that all this investment translates into greater benefits, and that is the reason why the market is divided between those who believe that there is a bubble and those who do not. We have commented many times that our positioning in this regard is very pragmatic, investments continue to be made and results and forecasts continue to be strong quarter after quarter. We ask ourselves what is more dangerous: having exposure to technology while controlling the level of risk or not having it and having lost very strong revaluations in recent years. Time gives and takes away reasons…
Very intense months are approaching, the shift towards new rate increases by central banks can cause a lot of volatility and the inflation data that comes out will take on a lot of importance. In addition, the elections in the US are approaching and the polls do not bode well for Mr. Trump, who has become hooked on the conflict in Iran and no matter how much he has put someone he trusts in charge of the FED, Mr. Warsh is closer to raising rates than lowering them, in the end the macro data rules and Mr. Warsh does not want to go down in history as the puppet who lowered rates when inflation soared above 4%…
We will also have to be, again, very attentive to the business results at the end of September, which follow the same line of strength, but we will address this point at length in future market comments…there will be time…