UBS: Investors will shift their focus from Middle East issues to economic and earnings fundamentals, and U.S. stocks remain attractive

ME News message. On April 17 (UTC+8), UBS’ April 16 research report said that, based on the bank’s baseline scenario, the final diplomatic solution to the Middle East conflict will allow investors to once again focus on healthy economic and earnings fundamentals. The bank said that during the escalation of the Middle East crisis, it has consistently believed that global and U.S. stock markets remain attractive. The bank expects the first-quarter earnings season for U.S. stocks to be strong, highlighting an optimistic outlook for corporate profits; earnings per share for this quarter is expected to grow by 17%, the fastest pace since Q4 2021. However, the bank also expects that the road to a long-term ceasefire in the Middle East will be fraught with difficulties; even if shipping through the Strait of Hormuz resumes, it will take time for global energy markets to return to normal. Therefore, we recently raised our Brent crude oil price forecast for the end of June from $90 per barrel to $100 per barrel. Considering the outlook for the energy market, stock markets most sensitive to high fuel costs—including the Eurozone and India—have become more cautious, and their ratings have been downgraded from “Attractive” to “Neutral.” (Jin10) (Source: ODAILY)