Global Climate Opportunities 2Q24 Commentary

July 19, 2024

Investor Letters

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Global equity markets got off to a rough start in the second quarter of 2024, with the outlook dimming for interest rate cuts due to persistently high inflation and rising geopolitical tensions in the Middle East. However, by the end of the quarter, the outlook improved as inflation indicators began to cool and company earnings generally exceeded expectations.

Recent International Monetary Fund forecasts show the U.S. economy growing more than twice the rate of other major developed countries. Strong U.S. economic data helped the Fed delay the timing of future interest rate cuts, which contributed to a negative backdrop for much of the climate space during the quarter. Capital is required for the climate transition, and fear of higher interest rates has kept shorter-term investors away from climate-oriented equities.

The global election cycle created additional volatility for climate equities, given early wins by the far right in European Parliamentary elections and early polls showing a less-climate friendly Republican lead in upcoming U.S. elections.

However, not all climate companies are created equal and several bright spots emerged throughout the quarter, including utility-scale solar companies and businesses tied to grid infrastructure upgrades.

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Global Climate Opportunities 2Q24 Commentary

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Global Climate Opportunities 2Q24 Commentary

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