My bookmarks

Pins are saved using cookies. Deleting them from your browser will delete your preferences.

Menu

Innovation remains key in a political environment where creativity is in short supply

25 April 2019

This first quarter of 2019 went beyond our expectations, with the markets recovering almost all of the losses of the last quarter of 2018.

innovation remains key in a political environment where creativity is in short supply

Equities have been rising steadily since 24 December. The quarter closed with something of a flourish: the S&P 500 has risen by more than 17% YTD (11 April) (the best Q1 since 2009) in a scenario in which monetary policy has become accommodative ‘again’. Oil prices have also shot up, reaching $68.39/barrel (+25.74%) on 29 March. In Europe, the Stoxx 600 has jumped by almost 16% YTD (+12.27% in Q1). All sectors have seen gains. Investors particularly favoured defensive growth sectors, notably consumer goods (+18%) and retail (+20.26%). Among cyclical sectors, basic resources also did very well (+19.20%) thanks to the support of China’s central bank and the positive vibes around a US-China agreement.

While we are again close to equity market highs, the equity fundamental indicators remain stretched. Analysts continually revised down their EPS forecasts for 2019 (from +8% at endJanuary to +5% at end-March) over a quarter that saw investors triggering major outflows and stock market trading volumes remaining very low.  

In short, everything seems to be under control from the Fed’s point of view, if we disregard the political noise.

Elsewhere, we have been to the Hanover Messe trade show, when we observed the latest technological advances and growth drivers, particularly 5G and its use in industrial applications. In particular, we attended the presentation by Bosch Rexroth, in partnership with Qualcomm and Nokia, of a factory "of the future". The arrival of 5G will enable the creation of private networks that are essential to the safe operation of fully automated factories. Previously, with 4G, each machine had to be physically configured, together with the accompanying human-machine interactions (HMI). With 5G in factories, it will be possible to communicate remotely with several machines and robots using "network slicing" in a single HMI system, which will reduce operating costs and optimise production.

In the case presented by Bosch Rexroth, using two key elements - a smart floor and 5G - robots can carry out production and logistics tasks by moving autonomously while avoiding the obstacles in their way and communicating with the factory’s other machines. Using a computer, a member of staff controls each machine operating on the surface while being informed of any malfunctions; the computer can also flag up the potential for a fault before it happens, enabling the staff member to take pre-emptive action. These installations are currently in the test phase, and could be on sale in a year.

This technology will support our efforts to reduce carbon emissions, helping to cut energy consumption through the optimisation and digitisation of production processes. Innovation remains a key driver.
 

Read Analysis & Strategy

La Française Group provides access to the expertise of a number of asset management companies around the world. To provide you with the most relevant information, we have developed an interface to present the full range of products available for your investor profile and country of residence.
Present yourself
1
Country
2
Language
3
Profile
Your country of residence
Your language
Your profile
<p class="new-disclaimer__legal-notice">Before consulting this website, for your protection and in your interest, please read the “<a href="en/legal-notice/" target="_blank">disclaimer</a>” and “<a href="en/regulatory-information/" target="_blank">current regulations</a>” carefully. This information explains certain legal and regulatory restrictions which apply to individual and professional investors according to local law. By accessing this site, in my non-professional or professional capacity, I acknowledge that I have read and accept the terms and conditions of use. Pursuant to the application of the European Markets in Financial Instruments Directive (“MiFID”), please state to which category of investor you belong&nbsp;:</p>
<p class="new-disclaimer__legal-notice">Before consulting this website, for your protection and in your interest, please read the “<a href="en/legal-notice/" target="_blank">disclaimer</a>” and “<a href="en/regulatory-information/" target="_blank">current regulations</a>” carefully. This information explains certain legal and regulatory restrictions which apply to individual and professional investors according to local law. By accessing this site, in my non-professional or professional capacity, I acknowledge that I have read and accept the terms and conditions of use. Pursuant to the application of the European Markets in Financial Instruments Directive (“MiFID”), please state to which category of investor you belong&nbsp;:</p>
By continuing browsing on this website, you accept the use of cookies and other tracing devices s as to allow you to receive information suited to your profile, facilitate information sharing on social networks, guarantee the best browsing experience possible and to create statistics. To find out more, we invite you to consult our Privacy and Cookies policy. Find out more.