Global investors have been recently challenged by the volatility in the US stocks as the key benchmarks, namely DJIA and SP500, ease from the monthly top but stay above the mid-September tops.
While noting this, UBS came out with the research report suggesting further upside momentum despite expecting additional volatility in the near-term.
The note cites three reasons for its bullish bias as follows:
- Whatever the outcome of the US election, we think the new stimulus will be rolled out after the vote and lift economic growth.
- Successful vaccine trials will increase certainty about the economic outlook. News on COVID-19 vaccines and treatments have not all been positive.
- Central bank policy is making the long-term case for equities over cash even clearer.