U.K. Cyclicals Are Better Positioned Than Defensives: Bloomberg Intelligence

The video discusses why UK cyclicals are better positioned than defensives in 2022, highlighting key drivers such as integrated oils, financials, and mining. It contrasts earnings outlooks for cyclicals and defensives, noting conservative estimates for cyclicals and optimistic ones for defensives. The video also covers valuation insights, market sentiment, and potential risks, emphasizing manageable risks and a broader procyclical theme across Europe. The conclusion invites viewers to explore further insights on the Bloomberg Terminal.

What is the primary reason for the expected better performance of UK cyclicals in 2022?

• Lower industrial metal prices

• Decreasing oil prices

• Influence of integrated oils, financials, and mining

• Higher interest rates

How do the earnings estimates for UK cyclicals in 2022 and 2023 compare to those for defensives?

• Cyclicals show robust growth, while defensives show small declines

• Both cyclicals and defensives show robust growth

• Both cyclicals and defensives show small declines

• Cyclicals show small declines, while defensives show robust growth

What does the current trading of larger banks, oils, and miners at forward earnings multiples below 10-year averages suggest?

• Market optimism about future growth

• Market indifference to earnings trends

• Market skepticism about sustained earnings rebounds

• Market confidence in sustained earnings rebounds

What is one of the risks mentioned that could impact the procyclical view?

• Decreasing interest rates

• Chronic infections

• Stable supply constraints

• Decreasing margins

What is the broader theme across Europe regarding cyclicals and defensives?

• Favoring defensives over cyclicals

• Equal preference for cyclicals and defensives

• Favoring cyclicals over defensives

• No clear preference