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While market swings have persisted as investors react to shifting trade and economic headlines, secular trends continue to provide a supportive backdrop for equities. Innovation remains a key driver of long-term equity performance in our view, and recent developments reinforce our conviction in the potential of our Transformational Innovation Opportunities (TRIOs): artificial intelligence (Al), power and resources, and longevity. Robust demand for Al compute is fueling record capital investment, with global Al capex expected to rise 60% this year and 33% in 2026, even as US-China tech tensions persist and as recent reports question whether artificial general intelligence is achievable.

In the power and resources space, surging electricity demand driven by Al data centers and electrification has led to major long-term energy contracts and strong sector earnings. Furthermore, May executive orders from US President Trump targeted nuclear generation expansion, reviving the nuclear fuel industry, and streamlining regulation in order to achieve an expanded target of quadrupling US nuclear capacity to 400 GW by 2050 (previously the Biden administration targeted a threefold increase to 300 GW). This is translating into increased investment—International Energy Agency data illustrate that spending on nuclear generation grew by c.14% per annum between 2021 and 2024, after a period of stagnation between 2015 and 2020.

Meanwhile, the longevity theme is supported by rising global demand for health care solutions, with the sector poised for growth despite near-term policy uncertainty and regulatory risks.

Takeaway: For investors seeking to benefit from enduring secular trends, we believe our TRIO themes offer durable growth potential that can outlast short-term volatility. We recommend a balanced approach to Al, combining high-growth semiconductors with resilient software and platform companies. In power and resources, we favor the electrification value chain, while in longevity, we see opportunities in select pharmaceutical, medtech, and health care service providers, as well as companies focused on nutrition and wellness. Investors anxious about the potential for further setbacks can also access the themes through structured strategies with capital preservation features, or via instruments that generate yield and seek to buy equities at lower prices than today's.

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