The bank says equities are likely to remain volatile in the near term, with its 2026 target for the MSCI All Country World Index set at 1,100, only slightly above current levels, News.Az reports, citing CNN.
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In a more optimistic scenario, a quick end to the conflict and stronger gains from artificial intelligence could push the index higher. But a drawn out war with limited productivity growth could see it fall sharply to around 700.
UBS also warned that markets may be underestimating supply chain disruptions and inflation risks linked to rising oil prices.
For now, investors appear cautious but not overly defensive, suggesting markets are consolidating rather than entering a full downturn.
