April 6: This Week's Thematic Reads
If you missed out on this week's signals, we've got you covered
Artificial Intelligence
"Chipmaker Nvidia sees big opportunities in healthcare AI and this week it launched more than two dozen new gen AI-powered microservices. The global computing powerhouse also inked collaborations with Abridge, Microsoft, GE HealthCare and Hippocratic AI to to expand its generative AI capabilities into healthcare and life sciences.” Read more here
“The artificial intelligence firm NVIDIA and the health intelligence company Hippocratic AI are developing “healthcare agents” to engage in remote conversations with patients. “We can help mitigate widespread staffing shortages and increase access to high-quality care – all while improving outcomes for patients,” says Hippocratic AI cofounder and CEO Munjal Shah.” Read more here
Artificial Intelligence, Digital Infrastructure
“Amazon.com Inc. plans to spend almost $150 billion in the coming 15 years on data centers, giving the cloud-computing giant the firepower to handle an expected explosion in demand for artificial intelligence applications and other digital services. The spending spree is a show of force as the company looks to maintain its grip on the cloud services market, where it holds about twice the share of No. 2 player Microsoft Corp.” Read more here
CHIPs Act
“The United States will partner with Mexico to explore semiconductor supply chain opportunities, the State Department said on Thursday, as the Biden administration pushes to reduce reliance on China and Taiwan for the technology. The collaboration will take place as part of the U.S. CHIPS Act, a 2022 law that created a $500 million fund for developing the semiconductor supply chain through initiatives with allies and partners.” Read more here
Cloud Computing, Digital Infrastructure
"Cloud infrastructure spending continues to accelerate towards more robust configurations mainly fueled by the explosion of AI-related investments," said Juan Pablo Seminara, research director, Worldwide Enterprise Infrastructure Trackers at IDC. "Even though some caution remains on the socio-political side, the improvement in economic prospects contribute to a very positive spending outlook for 2024 and 2025 where cloud-based spending is expected to rebound at double-digit growth rates." Read more here
Cybersecurity
“At least 68 cyberattacks last year caused physical consequences to operational technology (OT) networks at more than 500 sites worldwide — in some cases causing $10 million to $100 million in damages. Unsurprisingly, these weren't Stuxnet-like events, but the opposite. According to a new report from industrial control system (ICS) vendor Waterfall Security Solutions, which studied real-world cyberattacks on OT organizations, most of the hackers known to be targeting the OT sector these days are hacktivists. And the majority of disruptions are not caused by such direct manipulation of OT systems but are downstream consequences of IT-based attacks, most often involving ransomware.” Read more here
“MarineMax, self-described as one of the world's largest recreational boat and yacht retailers, says attackers stole employee and customer data after breaching its systems in a March cyberattack.” Read more here
“Data belonging to more than 1.3 million customers of the PandaBuy online shopping platform has been leaked, allegedly after two threat actors exploited multiple vulnerabilities to breach systems. PandaBuy allows international users to purchase products from various e-commerce platforms in China, including Tmall, Taobao, and JD.com.” Read more here
“Nearly a year on from the discovery of a massive data theft at healthcare biz Harvard Pilgrim, and the number of victims has now risen to nearly 2.9 million people in all US states…Names, physical addresses, phone numbers, birth dates, clinical information including lab results, and social security ID numbers were all compromised, Harvard Pilgrim said.” Read more here
“Reported data breach incidents rose by 34.5% in 2023, with over 17 billion personal records compromised throughout the year, according to Flashpoint’s 2024 Global Threat Intelligence Report. The firm recorded 6077 publicly reported data breaches last year, which included sensitive information such as names, social security numbers and financial data… The researchers also observed a 429% spike in stolen or leaked personal data in the first two months of 2024 compared with the same period last year, with 1897 billion personal records and credentials compromised.” Read more here
“AT&T said it reset the passcodes of about 7.6 million account holders whose personal information was leaked on the dark web after a data breach. The affected data set, which also includes information from more than 65 million former account holders, was leaked onto the dark web about two weeks ago…” Read more here
Digital Infrastructure
“The wireless telecommunications industry witnessed a year of unprecedented growth and innovation, propelled by the unstoppable momentum of 5G technology. In 2023, adoption of 5G connections accelerated, reaching 1.76 billion globally by adding 700 million, according to 5G Americas, the voice of 5G and beyond in the Americas, and data from Omdia… Global 5G connections are projected to skyrocket to 7.9 billion by 2028, with North America forecasted to boast an impressive 700 million 5G connections by the same year.” Read more here
Digital Infrastructure, Nuclear Energy & Uranium
“A surge in demand for electricity to feed data centres and to power an artificial intelligence revolution will usher in a golden era for natural gas, producers say. AI’s soaring energy needs will rise well beyond what renewable energy and batteries can deliver, executives argue, making more planet-warming fossil fuel supplies crucial even as governments vow to slash their use." Read more here
Digital Privacy & Digital Identity
“Experts envision an array of trusted digital identity credentials and platforms — mobile driver’s licenses, digital passports, electronic birth certificates, information verification services from the IRS and Social Security Administration, and more — that would help us prove our identity during remote transactions. These credentials would reduce identity theft — which siphons billions of dollars annually from the nation’s economy — while protecting consumers’ privacy and pocketbooks. Not only would better digital identities safeguard the current economy, they may expand it. One study from the McKinsey Global Institute estimated adoption of digital IDs could unlock economic value equal to 4% of the nation’s GDP.” Read more here
EV Transition
“The Elon Musk-fronted EV maker announced a shocking drop in quarterly sales on Tuesday, according to The New York Times. The company said it delivered 383,000 vehicles globally through the first three months of the year, which is 8.5 percent less than it moved in the same period last year. The delivery figure, which is the closest thing we have to sales data for Tesla, caught both industry analysts and investors off guard.” Read more here
“Stellantis Chief Executive Carlos Tavares in February made an intriguing announcement: The Chrysler-parent company would remain all-in on electric vehicles, even as competitors scale back and sales growth slows. “We’re going flat out,” he told analysts on the company’s earnings call.” Read more here
Market Hedge Model
“The Dow Jones Industrial Average fell for a second day, continuing Wall Street’s lackluster start to the quarter, as bond yields rose and traders lowered expectations that the Federal Reserve would cut interest rates in June… What we’re seeing is a one-two punch with the combination of continued hot inflation data with profit taking,” said Greg Bassuk, CEO of AXS Investments. With “very significant Q1 market gains … we’re due for a little correction. But we think that the investor narrative also continues to be higher for longer with respect to interest rates.” Read more here
Nuclear Energy & Uranium
“The government has set out plans for what it claims will be Britain’s biggest nuclear power expansion in 70 years, despite concerns about faltering nuclear output and project delays… Ministers published a roadmap on Friday that recommits the government to building a fleet of nuclear reactors capable of producing 24GW by 2050 – enough to meet a quarter of the national electricity demand. Approval will be given for one or two new reactors every five years from 2030 to 2044…” Read more here
Safety & Security
“As tensions between major powers continue to grow, many nations are increasing their investments in defense capabilities. With weapons stock depletion heightening the need for new and advanced technologies, the defence industry is poised to see significant growth in the coming years.” Read more here
Space Economy
“The global satellite data services market, valued at US $6 billion in 2020, is projected to skyrocket to $45 billion by 2030.1 Dominated for decades by a few public and private entities with limited and costly entry points, the space sector is rapidly expanding. And this maturation of space infrastructure is creating new opportunities for many companies to capitalize on the value of space data.” Read more here
The Strategies Behind Our Thematic Models
Aging of the Population - Capturing the demographic wave of the aging population and the changing demands it brings with it.
Artificial Intelligence – Software, chips, and related companies that facilitate the collection and analysis of large data sets and autonomous generation of solutions given non-machine language prompts.
CHIPs Act – Capturing the reshoring of the US semiconductor industry and the $52.7 billion poised to be spent on semiconductor manufacturing.
Cloud Computing – Companies that provide hardware and services that enhance the cloud computing experience for users, such as co-location, security, and edge computing.
Consumer Inflation Fighters - Companies poised to benefit as consumers stretch the disposable spending dollars they do have.
Core Holdings – Companies that reflect economic activity and are large enough to not get pushed around by day-to-day market trends. Low-beta, large-cap names able to better withstand economic turmoil.
Digital Infrastructure & Connectivity -The buildout and upgrading of our Networks, Data Storage Facilities, and Equipment.
Data Privacy & Digital Identity - Companies providing the tools and services that verify authorized users and safeguard personal data privacy.
EPS Diplomats - Profitable large capitalization companies proven to produce above-average EPS growth and provide investors with the benefit of multiple expansions.
EV Transition - Capturing the transition to EVs and related infrastructure from combustion engine vehicles.
Guilty Pleasure – Companies that produce/provide food and drink products that consumers tend to enjoy regardless of the economic environment and potential long-term health hazards associated with excessive consumption.
Homebuilding & Materials – Ranging from homebuilders to key building product companies that serve the housing market, this model looks to capture the rising demand for housing, one that should benefit as the Fed returns monetary policy to more normalized levels.
Luxury Buying Boom - Tapping into aspirational buying and affluent buyers amid rising global wealth.
Market Hedge Model – This basket of daily reset swap-based broad market inverse ETFs protects in the face of market pullbacks, overbought market technicals, and other drivers of market volatility.
Nuclear Energy & Uranium – Companies that either build and maintain nuclear power plants or are involved in the production of uranium.
Precision Ag & Agri Science – Companies that look to address shrinking arable land by helping maximize crop yields utilizing technology, science, or both.
Rebuilding America - Turning the focused spending on rebuilding US infrastructure into revenue and profits.
Safety & Security – Targeted exposure to companies that provide goods and services primarily to the Defense and security sectors of the economy.
Space Economy – Companies that focus on the launch and operation of satellite networks.
The Strategies Behind Our Dividend Income Models
Monthly Dividend Model – Pretty much what the name says – this model invests in companies that pay monthly dividends to shareholders.
ETF Dividend Model – High-yielding ETFs that provide a range of exposures from domestic equities, international equities, emerging market equities, MLPS, and REITs.
ETF Enhanced Dividend Model – A group of high-yielding ETFs that utilize options to enhance yield through collecting option income.
Don’t be a stranger
Thanks for reading and if you have a suggestion for an article or book we should read, or a stream we should catch, email us at info@tematicaresearch.com. The same email works if you want to know more about our thematic and targeted exposure models listed below.