Global trends will have an impact on these sectors

Global trends change many aspects of business and politics. While some of them, such as protectionism and political tension, can harm the economies, there are still ways for investors to get to the top, according to Credit Suisse.

In a report published last week at the Credit Suisse Global Supertrends conference, Economics and Research Bank Chief Nannette Hechler and Daniel Rupli, head of security research, discussed the "most significant societal changes" that could lead to profitable investment opportunities.

These trends are aimed at increasing spending in the sectors, including defense and cyber security.

At the same time, according to the bank, "Millenials tide" begins, according to which people under the age of 30 "increasingly influence business and their values." This means that areas like clean energy can be an important investment focus.

Here are some sectors that Credit Suisse says will be stimulated by the main trends.

Security and defense

Investments in defense, safety and cybersecurity are expected to continue to grow with growing threats such as terrorism and international conflicts.

"The threat to public safety from terrorist attacks, an unstable geopolitical situation or technology threats are among the main issues of society," the report said. The geopolitical environment, especially the situation in the Middle East, Syria and the Chinese Seas, "remains tense".

Other examples that highlight the need for defense and security include Russia, which reports that it will deploy a supersonic missile system and a massive breakthrough in the Marriott Starwood Hotels database.

Privacy is "at the top of the political agenda," so cybersecurity investment is likely to be a top priority for governments and corporations, according to the report.

"Moreover, given the rapid technological changes and the inter-state strategic competition - which has outpaced terrorism as a major concern for US national security - defense spending will increase further, for example in areas such as space, artificial intelligence, cybernetic or hyper-sonic technology. "The report said.

Clean energy

According to the report, public pressure on politicians to rely on renewable energy instead of fossil fuels will continue to grow with climate change.

Therefore, government policy is expected to become "more ambitious" in setting short and medium term targets for renewable energy, Credit Suisse said.

It says that as a result, this will have a "profound impact" on utility companies. They recommend that electricity companies that have already begun to change their business models become renewable energy operators.

In particular, the Bank recommends operators holding large assets that produce electricity from solar and wind power over suppliers of renewable energy equipment and technology.

These assets, according to the report, can "provide reliable and long-term revenue streams without incurring re-investment costs."

"In Europe, investors still underestimate the positive impact on revenue that will come from the introduction of cheaper wind and solar power into their mix," the report said, adding that the full potential for growth of any renewable energy infrastructure has not yet been evaluated.

Transport and infrastructure

Credit Suisse is bullish in terms of transport infrastructure operators such as airports, roadside assistance and railways, saying such businesses have a bright future.

For example, publicly traded airports in Thailand have benefited from the large number of passengers that has jumped more than three times over the last 10 years.

The bank also marks the French construction giant Vinci, pointing out that it is growing further through acquisitions - it acquired Gatwick Airport in December 2018 and intends to buy Aeroports de Paris.

Infrastructure is the focus of investors this year, Credit Suisse said, stating that the G20 has projected that the global infrastructure gap - the gap between the required infrastructure and planned projects - will increase to $ 14.8 trillion by 2040.

"The potential trade agreement between the US and China will remove a lot of uncertainty about global infrastructure projects," the Credit Suisse report said.

As the US Federal Reserve changed its tone on monetary policy, it could be good news for companies that are under pressure from higher spending on financing their infrastructure projects, according to the bank.

He pointed to recent earnings in the MSCI World Infrastructure Index, which grew by 9.97% at the beginning of the year by March 29.

The index includes sectors such as telecommunications, utilities, airport services and health care facilities, and others.

5G

This may be the year in which companies are finally taking advantage of the initial release of 5G technology, says Credit Suisse.

South Korea released 5G at the end of 2018, while the US introduced standards for the ultra-high speed data network. The next major launches are expected to be in Japan, China and Europe, but not before 2020, according to the bank.

Then its focus will be on 5G infrastructure providers such as data centers, telephone tower companies, and 5G telecom equipment equipment providers.

For example, phone tower companies can generate strong growth from the forthcoming 5G implementation. Demand for a wider bandwidth will increase and transmission distance between towers should be shortened to achieve a seamless 5G coverage, says Credit Suisse.

As a result, more towers will be acquired or combined to increase coverage, the bank said, citing a recent move by telecoms companies Telecom Italia and Vodafone Italia to a 5G network share agreement.

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