Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The report emphasizes the delayed impact of tariffs on US economic data, with inflation expected to peak by Q3 2025 and growth data lagging behind [6][14] - The strategists anticipate a convergence of US growth towards global growth, particularly European growth, which will influence interest rates and currency exchanges [5][11] - The expectation is for US treasury yields to remain range-bound until Q4 2025, with potential for lower yields if growth and inflation data align with forecasts [5][12] Economic Outlook - The report outlines forecasts for US Real GDP growth, indicating modest growth rates ranging from 0.1% to 0.7% on a quarterly basis from 2023 to 2026 [7] - Core PCE inflation is projected to peak in mid-2025, with a significant lag in data response to tariff impacts [6][14] - Emerging markets are expected to experience adjustments due to changes in US economic policy, with cautious outlooks on returns tracking US Treasuries rather than outperforming [11] Central Bank Policies - The report discusses the Federal Reserve's anticipated policy path, suggesting that while the Fed may hold rates steady in 2025, other central banks have more room to ease due to slowing growth and inflation [12][13] - The Bank of Japan faces challenges from tariffs and currency appreciation, with expectations for an extended pause in rate hikes despite resilient inflation [10] Market Volatility - The report notes significant market volatility in April 2025 due to unexpected tariff levels, leading to a shift in equity/rates correlations as markets adjusted to new economic policies [4] - The strategists highlight that the current pause in dollar weakness is temporary, with expectations for renewed dollar strength as the Fed's path becomes clearer [5]

Core Viewpoint - The current market is experiencing fear regarding tariffs and their potential impact on the economy, leading to stock sell-offs. However, there are opportunities to invest in companies with strong long-term prospects, specifically Meta Platforms and The Trade Desk [1][2]. Group 1: Company Overview - Meta Platforms is a leading player in the advertising space, owning major social media platforms such as Facebook, Instagram, and WhatsApp, with nearly all revenue derived from advertising [5]. - The Trade Desk operates a software platform for ad buyers, optimizing ad placements across the internet, excluding Meta's properties. It is experiencing growth in connected TV advertising, which is gaining market share from traditional TV [6]. Group 2: Market Conditions and Impact - Advertising revenue may be negatively impacted by tariffs, which could reduce consumer spending power and lead companies to cut advertising budgets during economic downturns [2][3]. - Despite potential short-term challenges, advertising spending historically rebounds, suggesting that long-term investments in advertising-centric companies like Meta and The Trade Desk could be advantageous [4]. Group 3: Stock Performance and Valuation - Meta Platforms has seen a nearly 30% decline from its all-time high, while The Trade Desk has dropped around 60%, with a significant loss following a missed revenue guidance in Q4 [7]. - The Trade Desk trades at 30 times forward earnings, reflecting a higher premium compared to Meta's 21.5 times forward earnings, but it has greater growth potential [9]. - Both companies are expected to report their Q1 results soon, with expectations that The Trade Desk may deliver a positive surprise after conservative guidance [10]. Group 4: Investment Outlook - Regardless of short-term performance, both companies are viewed as solid long-term investments, with current stock prices presenting attractive buying opportunities for investors [11].