The annual Bernstein Strategic Decisions Conference (41st this year) took place in New York at the end of May. It’s a fantastic opportunity to gain the US perspective on global events and an invaluable opportunity to meet many current and potential US holdings, especially timely given recent tariff uncertainty, as well as  CEO’s, Bernstein analysts and other fund managers.

Resilience

The general tone this year was more resilient and optimistic than expected, especially among tech companies. Many of us anticipated a more cautious outlook, but most US companies projected confidence. Banks (Citi, Wells Fargo), Visa, and Mastercard acknowledged consumer sentiment is mixed, yet consumer spending remains strong, buoyed by stable employment, wage growth, and easing inflation. Credit quality remains solid. As Amex CEO Steve Squeri put it, consumers are “complaining as they go spend.”

Tariffs

Tariffs were surprisingly absent from most conversations. A few companies noted modest expected impacts but showed little concern overall, contrary to European managers’ expectations. Interestingly, while methods were debated, many US companies supported the administration’s goals of rebalancing trade, suggesting Europe has had it “too easy.”

Regional Opportunities

The Middle East, particularly Saudi Arabia, came up often as a growth region, possibly due to recent business trips and orders tied to Trump’s Middle East tour. Optimism was high around defence, aviation, and data centre demand.

AI & Technology

AI dominated discussions. Companies are rapidly shifting from experimentation to real-world deployment, in factory automation, office efficiency, autonomous driving, and smart devices. This drives demand for more accessible chips from Analog Devices, Qualcomm, and Texas Instruments (all held in our Global Equity Income Fund).

Edge computing, benefiting firms like Analog and Qualcomm, was also in focus. It brings processing power closer to devices, enabling faster local decision-making, such as in automated factories, requiring more advanced chips and power. Growing chip usage and data demands from AI chips, personal devices, data centres, EVs, etc. are driving up energy needs. GE Vernovia projects the grid may need to double in capacity, with nuclear energy likely playing a key role.

AI Use Cases

Open Mind’s Allie Miller shared how AI customer service tools now handle up to 80% of client queries. Visa is trialling an AI assistant that can plan and book entire trips based on user preferences, something that is potentially transformative.

Boeing

Boeing attracted strong interest as a recovery play. CEO Kelly Ortberg outlined a ramp-up plan following past safety issues. The 737 MAX is at its FAA-imposed limit of 38/month, with a goal of 42 soon and 47 by early 2026. Widebody production (787, 777X) is also increasing. A recent 200-plane order from Qatar highlights recovering demand. Risks remain, most notably potential China bans, but recent trade developments are encouraging.

(Note: At time of writing, a Boeing 787 crash in Ahmedabad may impact recovery plans.)

Visa Outlook

Visa anticipates significant growth ahead, with $23 trillion in annual global transactions still conducted non-digitally. Even in ‘digital’ markets like Germany, cash remains dominant. Visa has added 10 million merchants in five years and doubled European staffing. AI-driven fraud detection is also helping them gain share.

Other Observations

The conference saw more women attendees again this year, a welcome trend. Formal attire (minus ties) was the norm, with sneakers giving way to proper shoes. I raised eyebrows by registering early in my walking gear! Paper notebooks are nearly extinct – most used laptops or iPads (as did I), while some younger attendees took notes on phones with Bluetooth keyboards. New York felt its usual vibrant self, but the cost of everything remains eye-watering – from coffee to cabs.

In Summary

US CEOs were more upbeat than expected. Tariffs and geopolitical uncertainty haven’t yet hit consumer or industrial demand. Most companies support US trade policy objectives. AI and automation are rapidly accelerating, driving demand for chips, power, and data. While a slowdown may come, there’s no current sign of it, and expectations are for it to be mild.

Citigroup CEO Jane Fraser put it well: “There’s nothing like being in Europe to make you feel good about the US,” pointing to the contrast in sentiment and growth.

In short, a pessimistic stance on US equities seems misplaced. Despite any near-term volatility around tariffs, it’s not too late to invest in AI beneficiaries.

Written by Pramit Ghose, Global Strategist, Cantor Fitzgerald Ireland

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