Global Capex: Where Are We Now? The last report of Standard & Poor’s

22 mar 2016
S&P estimates that Oil & Gas companies cut capex (global capital expenditure) by 24% in 2015, with a further 15% reduction slated for 2016
  • Global capital expenditure (capex) has experienced a severe retrenchment in the past 6 months driven by commodity related cuts.
  • S&P estimates global capex spending fell 10% in 2015, and is likely to shrink by a further 4% this year and 2% next.
  • If these projections are realized, the real-term value of global corporate capex in 2017 will have slipped back to where it was in 2006.
  • S&P estimates that Oil & Gas companies cut capex by 24% in 2015, with a further 15% reduction slated for 2016. Metals & Mining saw a 22% reduction capex decline in 2015 and a further 20% cut expected this year.
  • Forecast momentum also remains poor. Of the 32 companies in our Global Capex 2000 universe that were expected to invest more than $10 billion in 2016, 25 have seen estimated spending fall in the past 6 months. One small positive sign is that capex growth excluding energy and materials remains likely to return to positive growth (+2%) this year. Capex expansion is expected in the IT, consumer discretionary (autos and media), and health care sectors.  But, taken as a whole, this provides little consolation given renewed concerns about the fragility of the global economy and questions about the efficacy of central bank efforts to trigger investment.