UBP downgrades European equities as rising yields, energy costs pressure outlook
VGK•UBP downgraded European equities, citing higher energy costs, rising rates, wider France and Italy spreads, and weaker technology support. It raised its estimated fair-value range for the US 10-year yield to 4.75%-5.25% and kept neutral duration at four years.
1. European equities downgraded
UBP downgraded European equities, citing higher energy costs, rising rates, wider spreads in France and Italy, and weaker technology support.
2. Rates and earnings outlook
UBP raised its estimated fair-value range for the US 10-year Treasury yield to 4.75%-5.25%, citing renewed inflation pressure tied to energy costs, and kept neutral duration at four years. It said tech-led AI investment still underpins global earnings, while yields of 5.5%-6.0% could challenge valuations.
