UBS turns bullish on global equities

Investing.com -- UBS upgraded its outlook on global equities to Attractive, citing stronger-than-expected economic growth, easing tariff pressures, and a robust investment cycle driven by artificial intelligence.

In a note to clients, the bank told investors it has upgraded “global, U.S., China, emerging market, and Asia ex-Japan equities to Attractive.” 

UBS stated: “Structural trends remain firmly in place. The wave of strategic partnerships among leading AI players reinforces our confidence in a sustained capex cycle and greater revenue visibility—both of which should support the asset class over the next 6–12 months.”

UBS analysts raised the 2025 global earnings growth forecast to 8%, up from 6.5%, and expect high single-digit growth next year. 

The firm also noted that “economic growth has exceeded expectations and is likely to accelerate next year, with tariff headwinds easing, anticipated Fed rate cuts, and increasingly supportive fiscal policies.”

Despite renewed U.S.-China tensions, “we are increasingly confident that the balance of risks for equities remains favorable over the next 6–12 months,” UBS wrote. 

The bank cited improving fundamentals in China’s technology sector, which prompted upgrades to Asia ex-Japan and emerging market equities.

UBS continues to favor technology as its “top sector preference globally,” forecasting “nearly 40% EPS growth for Chinese tech in 2026.” 

It added that pro-growth policies should also “benefit financials—especially banks,” while Japan remains Attractive thanks to a supportive policy backdrop.

“Our TRIOs—AI, Power & resources, and Longevity—remain at the core of our strategy,” UBS said, adding that these themes “continue to deliver robust earnings growth” and should “provide a solid foundation for the market rally to continue.”