UBS Wealth Management and Investment Director's Office said that as the Federal Reserve cuts interest rates further and growth will accelerate again in the second half of next year, the current economic environment is favorable to the global stock market. Historically, stocks performed best when there was no recession and the Federal Reserve cut interest rates, and the latest economic data shows that they are currently in a favorable environment. The current weakness of the US economy may be temporary, and global growth should accelerate in 2026. Strong earnings growth expectations should drive the stock market higher. Although global stock valuations are still at historically high levels, valuation premiums are mainly due to growth in the higher-valued sectors of the benchmark weight. UBS also believes that profit growth is the more important indicator for measuring future returns. It is expected that profit growth in major markets will be at a steady level of 7%-14% next year, supporting the short-term upward trend. “Therefore, as the current favorable environment continues until 2026, underallocated investors may consider increasing their exposure to stocks.” UBS is optimistic about the US tech, healthcare, utilities, and banking sectors, and believes that “European leaders” are expected to benefit from policy and structural growth. In the Asia-Pacific region, I am optimistic about Australia, Japan, and China, especially the Chinese technology sector.

UBS Wealth Management and Investment Director's Office said that as the Federal Reserve cuts interest rates further and growth will accelerate again in the second half of next year, the current economic environment is favorable to the global stock market. Historically, stocks performed best when there was no recession and the Federal Reserve cut interest rates, and the latest economic data shows that they are currently in a favorable environment. The current weakness of the US economy may be temporary, and global growth should accelerate in 2026. Strong earnings growth expectations should drive the stock market higher. Although global stock valuations are still at historically high levels, valuation premiums are mainly due to growth in the higher-valued sectors of the benchmark weight. UBS also believes that profit growth is the more important indicator for measuring future returns. It is expected that profit growth in major markets will be at a steady level of 7%-14% next year, supporting the short-term upward trend. “Therefore, as the current favorable environment continues until 2026, underallocated investors may consider increasing their exposure to stocks.” UBS is optimistic about the US tech, healthcare, utilities, and banking sectors, and believes that “European leaders” are expected to benefit from policy and structural growth. In the Asia-Pacific region, I am optimistic about Australia, Japan, and China, especially the Chinese technology sector.