AI Outlook Remains Strong Despite Market Headwinds

UBS remains positive on the secular AI trend despite valuation concerns and rising yields, while noting accelerating EV demand in Europe as a key structural growth theme.

Key Takeaways

• 1.AI long-term fundamentals remain robust due to sustained demand and monetization, despite potential short-term volatility from high valuations.
• 2.Rising government bond yields and inflation concerns, linked to the closed Strait of Hormuz, are pressuring technology stock valuations.
• 3.European electric vehicle demand is accelerating (+34% YoY in April), providing structural growth opportunities in the industrial sector despite broader Eurozone equity headwinds.

Table of Contents

• From the studio
• Thought of the day
• What to watch: 21 May
• Caught our attention
• Market update
• Global asset class preferences definitions
• Appendix

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