🟢 [E2863] UBS highlights copper among standout individual commodities for 2026 alongside gold, sugar, soybean oil, and live cattle. Commodity prices projected to rise high-single digits driven by structural factors, supporting diversification and yield-focused strategies.

🟢 [E2860] US-Greenland diplomatic dispute renewed global investors' impetus for international diversification away from concentrated US exposure. UBS notes dollar showing atypical EM-style dynamics (depreciation with rising yields around tariff threats), suggesting higher risk premiums being priced into US assets — a shift in the traditional US exceptionalism narrative.

🟢 [E2889] Carry strategies remain appealing to UBS, supported by global fiscal stimulus triggering stronger growth in late 2026 and declining US yields in 1H26. Swiss franc is best funding currency given low yield. CNY upgraded to Attractive from Neutral. Maintains Attractive on EUR, AUD, NOK alongside selective high-yielding EM currencies.

🟢 [E2846] UBS rates USD as Unattractive, citing structural headwinds from US large twin deficits, investor concerns about Federal Reserve independence, and increased hedging demand for US holdings. Notes the dollar has shown atypical depreciation around tariff threats — dynamics typically seen in EM during financial stress — suggesting higher risk premiums being priced into US assets.

🟢 [E2864] UBS highlights European defense stocks as effective hedge against US-European tensions. War in Ukraine nearing fifth year with frontlines static. Escalation risks remain including direct NATO involvement and non-conventional weapons use. Additional risks from interplay between Ukraine war and other conflicts, including US-Europe disagreement over Greenland affecting security guarantees.

🔴 [E2865] UBS maintains Attractive view on high grade and investment grade bonds with tactical value in long-duration positioning in US, UK, and Germany, particularly middle part of curves. While acknowledging periodic volatility from fiscal and political challenges (citing Japan as recent example), sees declining US Treasury yields with year-end 10Y forecast at 3.75%.

🟢 [E2867] UBS highlights Venezuela developments following US operations on January 3 transferring Maduro to face charges. Countries aligned with US objectives — Panama, Dominican Republic, Argentina — are positioned to benefit from engagement and greater stability. Nations with complex US relations including Colombia and Brazil face more uncertain environment, especially ahead of elections. Mexico's deep trade integration makes major disruption unlikely.

🟢 [E2869] UBS notes diplomatic efforts toward Ukraine ceasefire have intensified but significant divisions persist. Progress toward a truce would likely improve economic sentiment in Europe and market sentiment toward European assets. Potential benefits include Ukraine reconstruction, improved hydrocarbon supply, lower energy prices, and possible easing of Russia sanctions — though positive Eurozone economic impact over 2-3 years likely to be modest even with sustainable ceasefire.

🟢 [E2870] South Korea equities up 19.7% YTD total return (USD) with 15.3% EPS growth and 51.1% weight in MSCI EM. Taiwan equities up 11.1% YTD with 21.6% EPS growth and 21.4% MSCI EM weight. Both markets benefiting from AI value chain positioning in chip and memory production. Korea trading at 11.1x P/E vs 10.4x 10-year average; Taiwan at 20.0x vs 14.9x average reflecting tech premium.

🟢 [E2871] Turkey added to recommended high-yielding currency basket. Turkish banks set for further margin expansion amid expected policy rate cuts. TRY showing orthodox policies supporting disinflation and rebuilt FX reserves. Turkey equities up 18.8% YTD with 53.8% EM weight, trading at 6.8x P/E (cheapest in EM) vs 6.1x 10-year average. High real yields make TRY appealing from carry perspective.

🟢 [E2872] South Africa equities up 14.7% YTD total return with 26.4% MSCI EM weight. ZAR included in recommended high-yielding currency basket. SA structural reforms meeting improving terms of trade from commodity rally. SA equities trading at 11.7x P/E vs 11.5x 10-year average with 2.5% dividend yield and 4.1% EPS growth. Local currency government debt up 5.2% YTD.

🟢 [E2845] UBS favors Brazilian equities after strong low-to-mid double-digit rally, seeing continued benefits from favorable global risk environment, diversification demand, softer dollar, and lower rates encouraging rotation from bonds to equities. Valuations below 10x forward earnings appear unjustified. Warns volatility may rise in H2 2026 on election dynamics and fiscal concerns.

🟢 [E2854] UBS favors India equities supported by resilient earnings, robust real growth, and supportive policies. Also favors Indonesia despite recent volatility from MSCI frontier reclassification concerns. Indonesia offers strong dividend yields, attractive valuations, and improving earnings trends. Base case expects timely solution with MSCI.

🟢 [E2855] UBS favors diversified basket of high-yielding EM currencies including BRL, MXN, INR, ZAR, TRY, and EGP. Three key supportive factors: elevated nominal and real yields with EM central banks cutting against Fed also lowering rates; resilient global growth at trend levels; and EM diversification appeal with robust buffers. South Africa benefits from structural reforms meeting improving commodity terms of trade.

🟢 [E2861] Venezuela developments highlight Washington's willingness to act decisively in Latin America. Countries aligned with US objectives (Panama, Dominican Republic, Argentina) positioned to benefit from continued engagement and stability. Nations with complex US relations (Colombia, Brazil) face uncertain environment, especially ahead of elections. Mexico's deep trade integration makes major disruption unlikely.

🟢 [E2862] UBS recommends broad commodity exposure beyond just precious metals. Gold, copper, sugar, soybean oil, and live cattle highlighted among individual commodities. Rising prices benefit yield-focused strategies and help diversify portfolios against inflation and geopolitical risks.

🟡 [E2868] UBS identifies key risks to their positive view: elevated equity valuations and positioning coupled with major economies' reliance on equity market performance mean a lasting correction could significantly impact growth and broad risk assets. Geopolitical risks (Middle East, trade escalation), US monetary policy two-sided risks tied to Fed chair nomination and investigations into board members, and potential Fed shift from labor market to inflation concerns are flagged.

🟢 [E2848] UBS maintains Attractive view on global, US, European, Chinese, emerging market, and Asia ex-Japan equities despite elevated valuations. Earnings dynamics and monetary policy remain key drivers over next 12 months. They expect ~12% EPS growth for MSCI AC World and 20% for MSCI EM. Recommends staying invested with broad diversification across asset classes and countries.

🟢 [E2851] UBS projects commodity prices to rise high-single digits in 2026, with energy and agriculture leading forward-looking returns. Optimism primarily influenced by structural factors while cyclical growth risks appear more evenly distributed. Energy sector benefits from geopolitical risk premium and potential supply disruptions.

🟢 [E2849] UBS views commodities as Attractive with particular preference for gold. Highlights gold as a valuable portfolio diversifier and stabilizer in face of rising geopolitical risks including Middle East tensions, US-European tensions over Greenland, and Iran-related risks.

🟡 [E2866] UBS argues sustained oil price increases appear unlikely provided no major disruptions occur. Iran's response to June 2025 bombing raids was muted as broader war with Israel/US/neighbors would endanger Iran's own hydrocarbon exports and regime stability. More measured actions against Iranian regime less likely to have lasting market effects — geopolitical events historically have smaller market impact when resolution is quick and conclusive.

🟢 [E2897] UBS projects agriculture as one of the leading sectors for forward-looking commodity returns in 2026 alongside energy. Sugar and soybean oil specifically highlighted among standout individual commodities, supporting yield-focused strategies.

🟢 [E2850] UBS identifies uninterrupted energy flows through Strait of Hormuz as critical — oil flows through the strait equivalent to ~20% of global petroleum liquids consumption. Key risks include Iranian leadership collapse causing output decline, or military action prompting threats to Gulf access. Significant disruption could trigger oil price spike and inflationary pressures.

💬 [E2898] UBS notes China has made notable advances in AI applications including robotaxis and humanoid robotics, achieving meaningful progress toward domestic self-sufficiency. Rapid adoption of these technologies should drive revenue growth and profitability for leading Chinese AI companies.

🟢 [E2847] UBS expects continued Fed easing with further rate cuts likely in 1Q26 on evidence of US labor market weakness. The Reserve Management Purchase (RMP) program is set to improve US dollar liquidity. Year-end forecast for 10-year UST yield at 3.75%, recommending investors lock in yields now. Carry strategies remain appealing supported by global fiscal stimulus.

🟢 [E2887] UBS argues EM bonds benefit from two key drivers: favorable global macro backdrop with Fed continuing to ease policy and global growth holding up better than expected, plus improving EM fundamentals with higher GDP growth rates and lower public debt ratios versus advanced economies, making EM more comfortable on debt sustainability.

💬 [E2856] UBS upgrades CNY to Attractive from Neutral, noting the Chinese yuan's rally against the dollar has accelerated since mid-November 2025. This reflects broader shift in currency dynamics where APAC currencies have weakened except CNY, which has strengthened against USD. The CNY upgrade represents UBS's view on currency fundamentals and policy trajectory.

🟢 [E2899] UBS notes South Korea equities delivered 23.4% returns in past month with 28.5% over 3 months, driven substantially by EPS growth. Taiwan delivered 13.3% monthly and 12.6% quarterly returns. Both markets feature leaders in AI value-chain including chip and memory producers benefiting from ongoing AI adoption.

🟢 [E2858] UBS expects mid-single-digit returns from EM bank bonds supported by 5.2% yield on JPM CEMBI Div Financial index. Operating environment favorable for CEEMEA banks in 2026 with loan growth expected. GCC bank margins may see some pressure from strong levels while Turkish banks set for margin expansion amid expected policy rate cuts.

🟢 [E2857] UBS upgrades EM hard currency bonds to Attractive citing compelling ~7% carry (JPM EMBIG Div index), expected high-single-digit 12-month total returns. Interest rate carry will drive returns, supported by expected decline in US Treasury yields. EM debt sustainability tends to improve during dollar depreciation periods.

🟢 [E2859] UBS identifies a supportive global backdrop for risk assets: elevated fiscal deficits globally (US benefiting from OBBBA front-loaded tax cuts, Germany ramping fiscal spending, accommodative Asian fiscal policies), Fed on easing trajectory, and inflation largely under control making rate hikes unlikely in 2026.

💬 [E2895] UBS identifies key risks to positive outlook: elevated equity valuations and positioning with major economies reliant on equity market performance; Fed policy two-sided risks tied to next chair nomination, board investigations, and inflation vs labor market prioritization; Middle East tensions disrupting oil; renewed US trade escalation with major economies.

🟢 [E2852] UBS maintains Attractive view on Chinese equities, rating mainland China tech as Most Attractive. China has made notable AI advances in robotaxis and humanoid robotics, with meaningful progress toward domestic semiconductor self-sufficiency. Combination of dynamic private sector innovation and strong government R&D support provides favorable AI environment.

🟢 [E2853] UBS highlights EM equities feature leaders in key AI value-chain segments including chip and memory producers in Taiwan and South Korea. AI adoption driving earnings growth expectations of 20% for MSCI EM, highest among major indices. Index composition now more tech-heavy and less commodity-focused, justifying above-average valuations.