For a sector accustomed to getting headlines for its stellar growth and equity returns, the past few weeks have felt a bit different for technology companies. It's time to take stock, think about what we’ve learnt and revisit our bullish macro case for the sector. In short, however, I still like tech.
History suggests that equities struggle to make gains ahead of US mid-term elections. With anti-trade rhetoric likely to feature in this autumn’s campaign, this time is unlikely to be different. On the other hand, we have also learnt to be prepared for the opposite with President Trump.
Having worked as an equity strategist for well over a decade, I’ve lost count of the number of times I’ve had the debate on ‘what happens to equities when bond yields go up?’. And for most of that time bond yields were in the ice age and falling! To cut down on some future deja-vu, here's my Top 7 list of things to consider about equities when bond yields go up.
Remember the EU referendum? The City thought the British public would see the economic benefits of EU membership and not wish to loosen ties with our closest trading partners. Turns out the City was wrong and had misread the mood of the nation. The current discussion around nationalisation has some worrying similarities, so is the City making the same mistake again?