FidelityMar 13 2017

CEO confidence hits 2014 levels

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CEO confidence hits 2014 levels

The managers of larger companies are now more confident than at any time since 2014, research has suggested.

Fidelity’s Global Sentiment Indicator, which is based on around 17,000 interviews with corporate decision makers by its equity and fixed income analysts, found that CEO focus has moved from making cost savings to demand-led growth.

Martin Dropkin, director of research for fixed income at Fidelity, said that the bounce back of the oil price, combined with continued innovation and demand growth is driving higher levels of investment activity.

“As a result, corporate fundamentals are now seen to be improving everywhere - in all regions and sectors,” he said.

The biggest improvements in sentiment came in the Eastern Europe, Middle East, Africa and Latin America regions. In China, too, sentiment has recovered.

In terms of sectors, the IT industry scored particularly highly, while traditional industries such as energy and materials also saw a bounceback in confidence.

Almost all analysts of these sectors said key corporate indicators were deteriorating in 2016 but are now optimistic for 2017.

The report, however, did warn of some material risks, with analysts highlighting the possibility of a further oil price slide, or disappointing growth.