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Survey provides unique and collective viewpoint of investment trends for year ahead, gathered from over 100 Fidelity analysts1.
Key findings include:
Artificial intelligence’s big breakthrough won’t happen this year. 72% of Fidelity’s analysts expect AI to have no impact on their companies’ profitability this year.
Fidelity analysts predict a surge in M&A under the new US administration with sectors including healthcare, communication services, IT, real estate, and energy.
Fidelity’s China analysts have high expectations for fiscal and monetary policies in 2025: over 70% of them say monetary policy will have a positive impact on companies’ fundamentals, while more than 80% say the same about fiscal plans.
Fidelity International (‘Fidelity’) today reveals findings from its annual Analyst Survey, collating the views of 112 of its global analyst team, to uncover emerging investment themes in the year ahead - and beyond.
Investors have entered an era of divergence - across economies, across sectors, and from one company to the next. Fidelity’s annual Analyst Survey is your bottom-up guide to this changed regime, with insights on AI, China, and the new administration in the White House.
1. AI’s big breakthrough won’t happen this year
Chart 1: A stagnant buzz
Fidelity’s analysts believe AI is expected to have a minimal impact on companies' profitability in 2025, suggesting that its full potential is still years away. While analysts acknowledged companies are seeing some benefits for back office and customer service activities, the majority of significant productivity benefits are still in their infancy. According to the survey, more analysts expect their companies will spend more on AI this year than expect them to materially increase their use of the technology. This could be software vendors bundling unloved AI features into existing products or an increase in research and development spending. Analysts found that tech, financials, and communications services sectors had the biggest expectations to increase their spending.
However, given time and patience, analysts do see a positive impact on companies’ profitability over a five-year period. Analysts suggest the biggest potential over this timeframe is in the healthcare and financials sectors via use cases like medical imaging, streamlining drug development and sales processes, originating loans, credit scoring and software improvements. Analysts also highlight the need to be selective, with more than a quarter (28%) acknowledging a high disparity in valuations of the companies they cover.
2. The return of President Trump: Start of the deals
Eight years on from his first inauguration as president, the global companies that analysts cover believe Donald Trump’s arrival in the White House will have more impact than last time. Yet there are also expectations of a real improvement in the value of a number of sectors, driven chiefly by hopes for a surge in corporate mergers. The prospect of easing domestic regulations and a more favourable environment for deal-making are cited, particularly in healthcare, communication services, IT, real estate and energy.
Chart 2: Hints of an M&A boom
Overall, the survey reflects a mix of positive and cautious outlooks among analysts around the world as policies and tariffs impact regions differently, but 47% of North American analysts highlight management at their companies being more confident about investing over the next 12 months. That number is three times what it was a year ago.2
3. China: Where investors should look as policy shifts
In China, despite risks from a troubled housing sector, persistent deflation, and sluggish consumer demand, analysts on the ground in the country see a number of areas of promise as the government pushes ahead with supporting growth in 2025. Analysts expect positive impacts in China from fiscal and monetary policy, with over 70% saying monetary policy will be a boost to companies’ fundamentals. More than 80% say the same about fiscal plans making both ratios the highest in the world.
Chart 3: China analysts have high hopes for fiscal policy
Chart 4: China analysts have high hopes for monetary policy
Pointing to the broad stimulus packages announced last year, analysts suggest generating demand has become a high priority for China. They believe the stimulus will lead to a gradual recovery in the consumer discretionary space, as the middle class are encouraged to spend more of their savings on bigger discretionary items like appliances, furniture, and consumer electronics.
More broadly, analysts believe dividends and buybacks are moving up the corporate agenda in China too. Around 60 per cent of Chinese analysts expect the companies they cover will moderately increase total dividend payouts this year. That’s higher than the 38 per cent in Asia (ex China, ex Japan), although it still lags behind Japan, which stands at almost 90 per cent - the highest in the world.
