Value lies in innovation for US investors

ON US

Investors finding US defensives too expensive to hold could look to the market's rich pool of innovative tech and chemicals companies, said Threadneedle's US equity head Cormac Weldon.

We believe the US is undergoing an industrial renaissance, driven by the shale energy revolution, and that the economy is set for sustained growth. Yet, rather than seeking to exploit these developments, investors have focused upon defensive, high-yielding areas of the market, which are now very expensive. We are finding value in certain cyclical sectors such as technology, where the US benefits from a level of innovation that other regions simply cannot match. Google, where revenues and earnings are growing at healthy double-digit rates – with earnings probably expanding at 20%-plus ...