“Artificial intelligence is also important to the shifting landscape,” Mucha continued. “It is important, for instance, in national security, for use in cyber security. Cyber attacks are one of the biggest risks. There are increasing investment opportunities in cyber security and cyber defence.”

“Climate resilience as a theme is also important,” Mucha said. In this respect, renewable energy is important. China is leading the way on renewables, notably in solar, batteries, and electric vehicles. While China still relies on fossil fuels, it produces more than 80 per cent of all solar photovoltaic panels, half of the world’s leading electric vehicles and a third of its wind power. Meanwhile, Trump reiterates “drill baby drill.” However, Mucha emphasised that a number of US states – California for instance – and the private sector remain focused on renewables. Sixty-six per cent of California's power, for example, came from renewables in 2023. “The US wouldn’t want to give China that power and see it taking control of renewables,” he added.  Demand is also rising for copper, silver and tin needed for artificial intelligence, tech and renewables.

On asset allocation, Amar Reganti, credit strategist at Wellington Management, said there has been a substantive shift towards emerging market debt and emerging market equities, as well as a move towards private markets and hedge funds.

He is not alone in his views. A number of investment managers are positive about emerging markets this year. Paris-based asset manager is also increasing his exposure to emerging markets. After lagging for several years, Melman believes that these stocks stand to benefit as investors reposition their portfolios away from the US – now that the AI cycle has reached maturity – and seek out new AI-related stocks. See here and here.