Buying Into All Time Equity Highs

UBS maintains a positive outlook on global equities, arguing that record highs shouldn't deter investors given strong AI-driven fundamentals and potential de-escalation in the Middle East.

Key Takeaways

• 1.AI spending remains a robust pillar for growth, with the four largest spenders increasing combined capex to USD 725bn this year.
• 2.Historical data shows that record market highs do not typically result in weaker forward returns; S&P 500 returns average 11.8% in the 12 months following an all-time high.
• 3.Geopolitical tensions in the Middle East, specifically the US-Iran situation regarding the Strait of Hormuz, are showing signs of de-escalation.

Table of Contents

• Thought of the day
• What to watch: 8 May
• Caught our attention
• Market update
• Global asset class preferences definitions
• Appendix

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