UBS Global Wealth Management predicts that the S&P 500 will increase by more than 10% by the end of 2025. This forecast is based on justified valuations on Wall Street, a strong US economic environment, and exposure to structural growth.

UBS recommends investing in mega-cap technology stocks and AI-related semiconductor companies, as well as utilities for their defensive characteristics and potential benefits from AI data centers. The firm also expects financial stocks to benefit from anticipated Federal Reserve rate cuts and deregulation.

In the Asia-Pacific region, UBS forecasts a 15% increase in the MSCI Asia ex-Japan index by the end of 2025. It emphasizes the importance of maintaining diversified exposure. UBS identifies Taiwan as a promising market due to strong AI demand and India for its favorable demographics and corporate earnings growth.

However, UBS expects European equities to underperform compared to their US counterparts, with weaker earnings growth projected. UBS suggests considering tactical investment ideas such as small- and mid-cap stocks in the eurozone and high-quality Swiss dividend stocks. The Euro Stoxx 50 is projected to reach 4,900 points by the end of 2025, up from its last close of 4,730 points.