UBS: Markets Have Room to Rise in 2023 Despite Lofty Valuations
• UBS sees further upside potential for equities and bonds in 2023 despite current high valuations • Soft landing remains base case scenario; lower rates and steady growth supports markets • Equities have room for modest gains given positive backdrop for earnings • Long-term yields could fall further as real rates above neutral rate estimates • Favors bonds on risk-adjusted basis; equities less attractive on valuation grounds