The expansion of 5G creates new investment opportunities in the technological field

The person responsible for the opening of the conference was Alejandro Haligua, regional director of BBVA Alicante, who emphasized the need to hold conferences of economic analysis and reflection to “share information that will enable us to make better decisions”. preferred technology as a strategic investment sector. “The massive connectivity we will have with 5G creates new opportunities for growth,” the leader said, before making the promise to Roberto Hernanz, Investment Strategy and Private Banking Analysis specialist at BBVA. Analysis of the current economic situation and outlook for the coming months.

In his speech, Hernanz stated that the big problems that exist for the economy today are the War in Ukraine and Russia in connection with the increase in energy costs, high inflation and monetary tightening by the central banks. Some concerns are already beginning to reach the global economy in the form of “slowing, cooling or recession” that Europe began to notice this last quarter and could last into the spring of 2023.

On the other side of the Atlantic, he said, “We’re already seeing signs of cooling in the US, particularly in the mortgage market, where interest rates have already reached 7 percent and are affecting home buying and selling.” Private Banking Strategy and investment analyst at BBVA. The North American country has hiked its interest rate to 3% to curb inflation, but is doing well for now, thanks to a “solid labor market and strong consumption”.

In the Old Continent, he said, unlike the United States, “we have imported inflation, which is not produced by higher consumption or competitive wage increases, making inflation crazier.” This is forcing interest rates to rise to 2%, after a 0.75 percentage point increase on Thursday, to curb the double-digit inflation in some eurozone countries. “The risk we have here is that we don’t know what the peak of inflation will be,” he said. However, he predicted that Europe would experience a period of moderate cooling (see appendix), and as soon as the peak inflation point is known and the decline begins, “we will see significant inflows in investment in equities”.

Fixed income and variable income

Roberto Hernanz, who enters the investment and portfolio management space, assured that this global instability, combined with volatility, has led to a “more complex year in terms of both fixed income and variable income asset management”. “This cocktail didn’t happen this year,” he lamented, though he explained that the goal was to work with balanced portfolios in markets and assets so that when fixed income went badly, it was to compensate for the dips of the variable and vice versa.

In this context, he proposed to start fixed income investment. “We didn’t recommend this before, but it’s time to change my name and go into fixed fixed income, for example. It’s already tempting, they’ve started paying us for our money, and normally landlines work well during the downturn of the economy. With the medium-term horizon set, we believe this is a good option.”

Concerning equities, a complex 2023 can be envisioned, but it will evolve from less to more. “I think there may be positive results in the short term, but we are seeing how companies are starting to revise next year’s corporate profits. They will be attractive in the medium to long term at current price levels. Especially when the doubts about war and inflation are gone.

golden age of technology

Where are the investment opportunities with this spherical panorama? Is technology a good shelter for money? These questions were answered by Fidelity International Sales Director Óscar Esteban-Navarro, who described the current situation in a technology sector marked by the decline in profits of the most important companies, coinciding with the rise in interest rates. According to him, a situation that does not reflect a “technological collapse”.

“Tech companies have been the ‘pretty girls’ of the markets in recent years. “What we have observed is that some tech companies have received an overvaluation that is not justified by their benefits, particularly as a result of the pandemic,” he said. With this fix, “we will experience a new golden age of technology, thanks to 5G that will revolutionize our lifestyle.”

From his perspective, 5G is more than just an improvement in voice or data transmission speed for end customers. With the exponential development of Artificial Intelligence and massive data analysis, it is a qualitative leap forward in the volume of information, directness and density of connected devices. Aspects that can have a major economic impact by promoting technological innovations and productivity gains.

Óscar Esteban-Navarro argued that in addition to Artificial Intelligence (AI), new consumption habits such as video streaming consumption developed during the epidemic will lead to an increase in investments by platforms to create new content and new viable viewing options. with 5G. He also added that the metaverse could become a reality and reach a market of $700,000 million by 2030. “And here it is important to take into account the large subsectors necessary to make the metaverse viable,” he explained.

The growth of online games, especially on mobile devices, is more than 8% per year, thanks to better graphics, sound and display options with 5G technology, which will be closely linked to augmented reality glasses and virtual purchasing. “And in the enterprise, AI and data management will reach more than $500 billion in volume by 2024,” he recalled. All this thanks to a 5G whose infrastructure, unlike 4G, will be more efficient and consume less energy, which will encourage significant investment in its construction and development. “5G is defining the future,” he said, not forgetting other technologies such as blockchain.

hold time

Eastern Territorial Private Banking director Ximo Raga concluded the day with a speech advising investors to trust and wait. “It is time for the investor to trust and own their investments. It seems contradictory to say when portfolios drop, but the current situation is conditional. When an investor invests, he or she considers an investment target and a time frame. Despite the current situation, they need to be protected. Whoever leaves loses the revaluation ».

Likewise, he underlined the role of technology as an investment for the future in the face of the predictions that the industry has reached its peak. “Technology is not over. 5G will change the way we relate to each other. We think we are very digital, but we have only just begun,” stressed Raga, who also values ​​the combination of technology and sustainability to face the challenges of climate change. “For BBVA, technology and sustainability go hand in hand and Our commitment to these areas is real. 5G can accelerate the fight against climate change.”

A “thin” economical cooling

Roberto Hernanz, Special Banking Investment Strategy and Analysis specialist at BBVA, wanted to show a more optimistic side when talking about the macroeconomic future in the euro area, and especially in Spain. Although he predicted that the economic weakening would worsen, he predicted that this weakening in the economy could extend into the second quarter of 2023, leading to a “short recession”. less pressure from energy prices” followed by a pause in the process of adjusting interest rates.

Likewise, he stressed that the current economic situation is very different from what happened in previous moments such as the pandemic or the 2008 crisis. the cooling period of the economy. It’s predictable and we’re actually preparing ourselves.” In line with this, he explained that people are spending less and trying to save, while companies manage their energy and gas use as in the industry, or limit the temperature to face this period. He also pointed out that fiscal stimulus policy, low private debt, high savings accumulated during the pandemic period, as well as the existence of a healthy financial system and a resilient labor market will help this “soft” recession.

Therefore, he believed there would be “a subtle recession”. We’re going to have to have a complicated moment, but I don’t think it will be dramatic,” he concluded.