Beyond Markets Julius Baer

The oil market has remained surprisingly calm despite the recent geopolitical tensions in the Middle East. What are the dynamics at play here? And looking ahead, how might the oil and gas industry evolve as we head into a new era of energy transition and electric vehicles?

In this episode, Norbert Ruecker, Head of Economics & Next Generation Research speaks to Pearlyn Wong, Investment Content and Campaigns Asia, on his latest insights on the oil market.

As gold prices hit record highs, we are joined in the studio by Carsten Menke, Head of Next Generation Research, and Chris Irwin, Head of FX and Precious Metals Trading Asia, to discuss the causes and consequences of the metal’s remarkable rally.

The most likely trajectory for the Middle East is that things de-escalate. World economic growth looks set to accelerate, meaning inflation could remain sticky. We look for rate cuts in September, November and December, and for treasury yields to come down a little bit. Technology stocks are sensitive to the slightest negatives, but a strong economy still suggests a positive outlook for earnings growth this year.
This episode is presented by Mark Matthews, Head of Research Asia at Julius Baer.

Middle East, oil, economic growth, inflation, rate cuts, treasury yields, technology stocks, earnings growth.

The significant innovation in the semiconductor industry over the years has undoubtedly enabled the huge advances in artificial intelligence. But where do we go from here? Will more efficient and better performing chips be enough to satisfy the requirements of AI models? 
In this episode, Helen Freer, Investment Writer, talks to Luca Menozzi, Next Generation Analyst, about what the transition to a new era in computing architecture might mean for the future of AI.
01:14 Has innovation in the semiconductor industry enabled the advances in AI?02:45 What is Moore’s law?03:38 What’s the scope for chips to shrink further?04:41 Why do some industry experts believe that Moore’s law is dead?05:53 Will the advances be enough to satisfy the requirements of AI models?06:39 Are bottlenecks expected that might hinder the future growth of AI?07:42 Who is buying the chips?08:24 Is the demand for semiconductors set to increase?09:24 Conclusions
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The S&P’s performance after “shock events” shows, unsurprisingly, that the ones that caused no damage to the economy had the least impact on the market, and vice versa. The oil price is steady post Iranian attacks on Israel, suggesting the latter this time.

While the Yom Kippur War and Oil Embargo of 1973 strike parallels with today, the global economy is less than half as reliant on oil as it was then. There are many other suppliers apart from the Middle East, and no one is talking about an embargo today. March CPI inflation at 3.5% year/year has caused concerns that inflation is beginning to trend higher again. But the culprits driving it (auto insurance and rents) are likely to come down.

This episode is presented by Mark Matthews, Head of Research Asia at Julius Baer.

In this monthly China update, our experts analyze the recent depreciation of the Chinese Yuan, the impact of potential quantitative easing on the Chinese economy, how to look at the Chinese EV sector against the backdrop of a volatile Sino-US relationship, and also why Gold continues to surge.

This episode is presented by Richard Tang, China Strategist and Head Research Hong Kong at Julius Baer with Hong Hao, Partner and Chief Economist at GROW Investment Group, and was recorded on 8 April, 2024.