US Infrastructure: A Defensive Play with Long-Term Potential

As of early September 2024, the S&P 500 index has been recovering from its recent losses, though the journey has been marked by volatility, particularly among mega-cap technology stocks. For example, the MSCI US information technology index remains 6.5% below its July peak. This period has highlighted the uncertainties surrounding market leaders, particularly in the tech sector. In contrast, the infrastructure sector, represented by its MSCI benchmark, has been performing strongly, achieving new highs. This performance is due to several factors, including diminishing excitement around artificial intelligence (AI), declining bond yields, and robust underlying fundamentals.

Legislative Support and Future Outlook