UBS analysts provided information on the situation key issues investors will face in the second half of 2024 and into 2025.
Year to date, the index is up 15% amid optimism about artificial intelligence. And despite persistent inflation and rising interest rates. Here’s how UBS solves investors’ biggest problems:
Interest rates and economic growth: UBS expects slower economic growth and inflation data to lead to interest rate cuts by major central banks. “We recommend that investors prepare by moving excess cash into quality fixed income,” UBS said. Lower US interest rates could also weaken the US dollar while supporting commodities. UBS advises investors to “sell as the dollar strengthens and look for opportunities in various commodity markets.”
AI Investment Opportunity: UBS believes that artificial intelligence represents one of the… largest investment opportunities in history. “Investors need to make sure their portfolios.”with artificial intelligence support“,” UBS emphasized. Favorable sectors include semiconductor companies and vertically integrated oligopolies in the US and China. However, UBS warns of the risk of overinvestment fears leading to a market correction and recommends capital preservation strategies.
US elections and market volatility: Due to the upcoming US presidential elections, UBS expects share market volatility to increase. “It is prudent to consider approaches to risk management,” UBS said. They offer United States If Trump wins, the consumer services and renewable energy sectors could be at risk, while the financial sector could see up. UBS also emphasizes that gold is an effective hedge against geopolitical and economic uncertainty.
Throughout the year, UBS has emphasized the importance of positioning portfolios based on evolving artificial intelligence, interest rate changes and the US election, advising a balanced mix of stocks, bonds and alternative assets to navigate uncertainty.