Cleantech & Energy transition: Energy transition stocks - the trade has yielded, time for a pause as the sectors faces short-term challenges

Cleantech & Energy transition
Energy transition stocks - the trade has yielded, time for a pause as the sectors faces short-term challenges
Energy transition stocks have emerged as the winner of the Ukraine/Russia conflict, largely outperforming the market, boosted by announcements from European leaders trying to accelerate the transition to renewables and phase out Russian O&G imports as soon as possible.
However, we consider that investors have only factored in the positive impact of the energy crisis (acceleration of the green energy transition) but they will gradually look at all the negative implications (higher inflation/discount rate, challenged supply chain…). We believe the trade on energy transition stocks has yielded and it’s time for a pause.