Daily General Analysis
February 19, 2025
The latest news provides a comprehensive overview of geopolitical tensions, global economy, and technological advancements. I will detail some of these issues and share insights on the potential impact on the financial market, also offering investment suggestions considering the current scenario.
1. The designation of Mexican cartels and other groups as foreign terrorist organizations by the US could lead to an escalation of financial measures against these groups. This has the potential to affect markets due to possible increased security and stability in the region, but could also provoke retaliations.
2. The announcement of 25% tariffs on automobiles and other products such as pharmaceuticals and chips by the US indicates growing tension in international trade, especially with China. This could result in inflation and market distortions, putting pressure on global supply chains and potentially triggering a global recession.
3. The EU's military assistance to Ukraine, amounting to 6 billion euros, strengthens Kiev's strategic positioning but also increases tension in the region. This has the potential to impact global energy and commodity prices, as well as alter the geopolitical balance.
4. China's response to the passage of US warships through the Taiwan Strait highlights the tensions between China and the US, already under pressure due to the announced "tariff shocks." This could affect investor sentiment and trigger volatility in global markets.
5. The project to connect five continents via an undersea cable is a positive development for technology and the telecommunications sector, potentially benefiting companies directly and indirectly involved in the project.
Insights & Investments:
Geopolitics and Defense: Increasing geopolitical tensions and significant investments in defense suggest that companies in the defense, security, and related technologies sectors could perform well. Companies like Lockheed Martin and Northrop Grumman could benefit from increases in military spending.
Technology and Infrastructure: The Meta undersea cable project indicates an investment in global digital infrastructure. This suggests growth potential for telecommunications and information technology companies, including cable and infrastructure providers like Nokia and Ericsson, as well as Meta itself.
Commodities and Energy: Geopolitical instability and sanctions can affect the global supply of commodities, especially energy. This makes investment in renewable energy companies like Vestas Wind Systems and First Solar attractive, as well as metallic commodities, given the demand for rare earths.
Cryptocurrencies: Considering the pro-crypto policies mentioned, Ethereum ETFs may be an option for those seeking exposure to the cryptocurrency market in a regulated and secure manner.
Risks: It is crucial to consider the volatility associated with geopolitical tensions and economic uncertainty, which can negatively impact markets in the short term. Diversification and an investment approach based on solid fundamentals are essential to mitigate these risks.
