The long-term structural bull case for the technology sector and the relative strength of several tech firms during the recession are well established. But we believe the present crisis has also created additional macro tailwinds for tech stocks. ;
A lot has changed in the month since we set out our thoughts on what comes next for the global economy. The range of outcomes has narrowed a little, but there remains huge uncertainty about the virus, the speed of recovery, the lasting damage to output, and inflation implications. ;
Current social restrictions may not yet be sufficient to suppress COVID-19 in Europe and the US, but the lack of influenza cases in the southern hemisphere this winter suggests restrictions should be strong enough to quell the less-infectious winter ‘flu’ – meaning hospitals have more capacity than previously feared. ;
We could see a double dip in restaurant sales in the Northern hemisphere heading into winter, which could contribute to the ‘V-shaped’ recovery becoming more ‘square-root’ shaped before growth improves again in the spring alongside progress on vaccine distribution.