Consumer Discretionary

The rise of remote work, online dating, and other demographic changes are increasing the demand for aesthetics. GLP-1s provide an effective and inexpensive cure for obesity, and their secondary effect “Ozempic face” has structurally altered the demand for aesthetic procedures and skincare. Long GLP-1 producers, biostimulator injectable producers, and K-Beauty contract manufacturers.

Despite macro headwinds, the OBBBA clearly favors Industrials, Financials, and Consumer Discretionary equity sectors. A carefully constructed, factor-aware basket in these sectors is well positioned to outperform in a fiscal-driven, uncertain environment. 

Chinese tourism will continue growing, but investors should be mindful not to overpay for Chinese tourism stocks by extrapolating their past double-digit revenue growth into the future.

Trump’s ceasefire talks are positive for Germany – and so was the German election result. But Trump’s tariffs will hit Germany soon. Investors should use near-term volatility to increase exposure to Germany.

Global risk assets are engulfed in a wave of euphoria, which is pulling Europe higher along the way. However, risks still abound. How should investors adjust their allocation to Europe under these highly uncertain conditions?
 

In this first presentation of 2025, we start with an overview of the 2025 outlook webcast polls, and a brief post-mortem of the 2024 market performance. Then, we shift gears and examine what is behind the recent surge in bond yields and its implications for equities. We also review market technicals and positioning and conclude with a list of trades to prepare our portfolio for continued moves in yields.