Top thematic ideas for H2
- In 2023 several market assumptions have been turned upside down.
- In January some of the biggest consensus trades were: long energy, China, and the dollar; short US equities, particularly tech.
- Consensus H1 trades failed, we believe, because investors underestimated how the thematic drivers of markets have become more important as inflation has receded.
- Thematic drivers include the incentives behind geopolitical tensions, the labour market, how investors are pricing in future rate cuts, and the differences between Chinese and Western economic stimulus.