Global equity outlook 2024

AI adoption

The emergence of artificial intelligence (AI) was a dominant market force in 2023. We were initially hesitant about joining this particular party, but our subsequent research has led us to reappraise this position. While we still believe AI contains an element of hype, we think it has the potential to transform technology for the next generation. It is too early to define the long-term winners from the new business models and use cases being inspired by AI, but there are market leaders already benefitting from the rapid adoption of this new technology that fit our Future Quality criteria.

Enablers of the energy transition

There is a need to reduce humankind’s reliance on fossil fuels and create cleaner alternatives through renewable sources of energy, but this transition is not straightforward. Increased spending is needed to sustain existing energy production at the same time as mitigating carbon missions. While we believe that there is a fruitful pool of investment opportunities on both sides of this equation, the transition is heavily reliant on fiscal spending and political support could prove to be fickle.

Normalisation and structural growth in global travel

The travel industry is still in the process of recovering from pandemic-imposed restrictions, with countries at differing stages of normalisation. Yet, when you look at the core consumers of travel, we see that demand remains robust. This seems particularly true for younger generations, who place greater value on “experiences”. Furthermore, we see that a new travel cohort is emerging from developing countries where rising gross domestic product per capita means more people will be able to afford to travel in the future.

Providers and enablers of healthcare efficiency

With an ageing population, providing sufficient and efficient healthcare, as well as reducing the cost of such services, may be one of the world’s most important challenges going forward. In our view, this demographic test will—and has been—a great hunting ground for investment ideas as healthcare companies innovate to deliver much-needed solutions. That said, some subindustries within the healthcare sector have underperformed of late as a consequence of the pandemic pulling demand forward and creating ongoing staff shortages.

We are heading into a changing world, where the more recent past can no longer be relied on to guide our path forward. But we are not blindfolded. There are tools we can use to provide a greater degree of certainty. Our Future Quality approach is designed to help us identify franchises that are set to endure. Some of these companies may not have been in the vanguard of market leadership over the last decade. However, in this instance, we can more reliably believe history when it tells us that in times of change, the market leaders at the start are rarely the same as the ones leading us out of it.

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Global equity outlook 2024

AI adoption

Enablers of the energy transition

Normalisation and structural growth in global travel

Providers and enablers of healthcare efficiency

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