2024 market outlook: Cogence expects biggest investment impact from AI interaction

As the first quarter of 2024 comes to an end, the global market continues to face uncertainties and volatility, with anticipated interest rate cuts being pushed further into the year. The geopolitical landscape, marked by wars and the largest election year ever, has created a sense of caution among central banks, leading them to wait and observe before making any significant moves. Janelle Matthee-Ferreira, CEO of Cogence, highlighted the impact of these uncertainties on the overall market outlook during a recent interview on CNBC Africa. Matthee-Ferreira noted that the delay in interest rate cuts is a result of central banks facing constraints in injecting liquidity into the market, unlike in the past. With 49% of the world's population participating in elections this year and ongoing geopolitical tensions, the environment remains unpredictable. While Matthee-Ferreira did not provide a specific timeline for the interest rate cuts, she suggested that it may happen in the second half of the year once there is more clarity. Amidst these challenges, technological trends like artificial intelligence (AI) are reshaping the market landscape. In 2023, a few dominant tech companies drove market growth in the US, a trend that is now spreading to Europe and other regions. Matthee-Ferreira emphasized the need for clarity and certainty in the market, especially during an election year, before central banks begin to adjust interest rates. She highlighted the importance of asset allocation and portfolio creation in such a dynamic environment. Partnering with firms like BlackRock, Cogence focuses on identifying companies that can benefit from AI and biotechnology advancements. Matthee-Ferreira stressed the value of active management and quick adaptation to technology-driven changes in the market. Regarding cryptocurrencies, Matthee-Ferreira acknowledged the growing interest in alternative assets like Bitcoin and the importance of diversifying portfolios. While Cogence is not currently invested in crypto, she noted that a well-diversified crypto portfolio could benefit investors, especially the younger generation familiar with the market. When it comes to local market opportunities, Matthee-Ferreira expressed optimism about South African stocks with strong growth potential, such as Naspers. Despite uncertainties in the local market, Cogence maintains a balance between global and local investments, leveraging opportunities in both arenas. Matthee-Ferreira's insights shed light on the delicate balance between navigating uncertainty and embracing innovation in the ever-evolving market landscape of 2024.