insights.

Markets are looking through geopolitical risk to focus on potentially greater corporate earnings due to AI-driven productivity. 

Higher long-term real yields are often attributed to monetary policy or a higher term premium; We consider the role of the cost of capital. 

Positive and broad-based corporate earnings, AI capex and contained inflation support equity and fixed income markets. 

Oil shocks drive inflation fears, rate expectations and markets – yet the link between oil, inflation and policy tightening is weakening.

Simply put analyses the impact of AI on jobs since 2022 and finds a more nuanced picture than pure employment destruction.

Resilient earnings, a reset in equity and fixed income valuations and selective AI interest helped markets move past the Iran war shock. 

As the Q1 earnings season approaches, we consider the extent to which US corporate earnings will be harmed by disruptions to the oil supply.

The growth and inflation impacts are seen by markets as risks to be hedged, while robust corporate earnings forecast support equities.