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UBS projects the S&P 500 to reach 6,600 by the end of next year, despite fewer anticipated Federal Reserve rate cuts, now expected to occur in June and September 2025. The Fed's decisions will depend on economic data, particularly labor and inflation trends, while UBS advises investors to focus on high-grade bonds and diversified income strategies.
The Dow Jones Industrial Average surged nearly 400 points, reversing a 10-day losing streak, as investors reacted positively to a lower-than-expected inflation report, despite looming government shutdown concerns. Nvidia's stock attempted a recovery, while shares of Trump Media and Technology fell sharply after the president-elect moved shares to a revocable trust. FedEx initially soared over 20% on earnings but later declined, while Carnival's stock rose 3% following better-than-expected quarterly results.
UBS forecasts the S&P 500 to reach 6,600 by the end of next year, despite expectations for fewer Federal Reserve rate cuts, now anticipated in June and September 2025. The Fed is closely monitoring labor market trends and inflation, with core inflation currently at 2.8%. Investors are advised to focus on high-quality bonds and diversified income strategies while considering the overvaluation of the US dollar.
UBS projects the S&P 500 to reach 6,600, despite an anticipated reduction in the number of Federal Reserve rate cuts. This outlook reflects confidence in market resilience amid changing monetary policy dynamics.
UBS Asset Management’s Kevin Zhao plans to buy US Treasuries during the holiday season, anticipating that President-elect Trump’s policies will negatively impact economic growth. Despite a market trend of selling off Treasuries, Zhao believes yields will rise to 4.6% before year-end, and he is adjusting his strategy to capitalize on potential market volatility. He argues that the benefits of tax cuts are being overestimated and may not materialize until 2026.
UBS Asset Management’s Kevin Zhao plans to buy US Treasuries during the holiday season, anticipating that President-elect Trump’s policies will negatively impact economic growth. Despite a market trend of selling off Treasuries, Zhao believes yields will rise to 4.6% before year-end, and he sees potential buying opportunities amid holiday market volatility. He argues that the benefits of tax cuts are being overestimated and may not materialize until 2026.
US stocks rebounded on Friday as inflation data indicated a slowdown in price increases for November, with the Dow Jones up 0.8%, S&P 500 rising 0.7%, and Nasdaq gaining 0.6%. The core Personal Consumption Expenditures index showed monthly deceleration, although inflation remains above the Fed's 2% target. Concerns over a potential government shutdown and tariff threats from Trump weighed on global markets, while Novo Nordisk's shares plummeted 20% following disappointing trial results for its obesity drug.
Oracle's stock was downgraded to "sell" by analyst Brian White, citing stretched valuations and disappointing earnings results despite a strong year-to-date performance. The company faces fierce competition in the cloud market from tech giants like Amazon, Microsoft, and Google, and plans to double capital expenditures to $14.2 billion amid a challenging macro environment. Shares have dropped over 10% in December, marking the worst month of 2024, following a significant earnings miss.
The Manufacturers Life Insurance Company increased its stake in Lennar by 1.3%, now holding 5.9 million shares valued at over $1.1 billion. Institutional investors own 81.10% of Lennar, which has received mixed ratings from analysts, with a consensus "Hold" and an average target price of $175.94. Recently, UBS Group lowered its price target for Lennar from $225 to $205, suggesting a potential upside of nearly 49%.
The Manufacturers Life Insurance Company increased its stake in Lennar by 1.3%, now holding 5.9 million shares valued at over $1.1 billion. Institutional investors own 81.10% of Lennar, which has received mixed ratings from analysts, with a consensus "Hold" and an average target price of $175.94. Recently, UBS Group lowered its price target for Lennar from $225 to $205, suggesting a potential upside of nearly 49%.
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