Hello everyone. Welcome again to Rendezvous with the Mirova Sustainable Equities team. Today I'm in Paris with my team here. It's brutally hot. Climate change is not really helping us today. And I thought it would be actually a very good time to share some of our views for the second half of this year. We've had obviously very volatile first half of the year dominated by geopolitical issues and by, you know, the tariffs discussions. And we expect that to continue with a lot of binary events starting already on the 9th of July when the 90 day moratorium around the tariffs is gonna end. And we're gonna get more clarity at that time, very likely leading to more volatility in the markets as well. Generally if you can avoid a recession in the US and certainly also like a global recession if you can avoid that, I still think we're gonna have, you know, an okay second half of the year for equity markets as well.

But again, it's gonna be very volatile. What we do know is that we're gonna start seeing the impact of the tariffs from the summer and going into the second half of the year as well. So we're quite negative on anything related to the US consumer because either we're gonna see increased prices, which will lead to lower demand, or consumer stocks will have to absorb that in their margins, which ultimately may weigh and will weigh very likely on their share prices as well. So that's an area we're avoiding apart from companies with exposure to the lower income consumer which in this kind of scenario typically should actually outperform as well.

Three areas we do like are the continuation of AI. AI is actually being deployed a lot faster than we already anticipated. So we continue to see opportunities across the whole supply chain on the equipment side, but also focus more and more on how companies integrate AI in their business models as well to help them to either reduce costs or to add to their margins and to add to their growth as well.

A second area also partly related to AI is building out our energy system. For the first time in a very long time we expect increasing energy demand as well, which is good for combination of things, including renewables, but also the grid, in mainly Europe and in the US including companies that operate the grid, but also companies that make components to go into the grid for instance.

And a third area that we really like as well is you know, companies that help local companies because we have this focus on building out the local economies now as well, but that help those local companies to grow in terms of field software to be active online, helping them to reorganize their supply chains more locally as well, these are all areas we like for the second half of the year as well.

So, looking forward to the next six months and I'll see you in a few weeks’ time