UBS’s CIO assigns a 60% probability to a base-case in which equities rise over 12 months and forecasts the S&P 500 at 8,200 by June 2027 while detailing downside, base and upside strategies. UBS CEO Sergio Ermotti said Swiss capital rule revisions will balance competitiveness and stability, affecting capital buffers.
UBS’s Global Risk Radar assigns a 60% base-case probability for equities to climb over the next 12 months and projects the S&P 500 reaching 8,200 by June 2027.
The bank allocates a 20% probability to a bull case where rapid reopening of the Strait of Hormuz drives oil prices below $80 and fuels double-digit equity returns, and a 20% bear case where prolonged Middle East disruptions could push Brent towards $150–$200 before demand destruction.
To guard against downside, UBS suggests rebalancing into high-quality government and investment-grade bonds, favoring shorter-duration debt, and adding alternatives and commodities, while base-case tactics include structured yield strategies like reverse convertibles and redeploying excess cash into high-conviction ideas.
UBS CEO Sergio Ermotti highlighted that Swiss lawmakers will balance banking competitiveness with financial stability in drafting new capital rules, a shift that could influence the firm’s capital buffer requirements and cost of funding.
