UBS On-Air: Market Moves

Explore the Federal Reserve's December 2025 policy decision and its implications for the market. Uncover theories on why the meeting timing stayed unchanged, hinting at confidence from Chair Powell. Delve into potential dissent within the Fed, and how it could complicate leadership for his successor. Discover how rate cuts may protect jobs instead of serving as broad economic boosts. Plus, insights into China's inflation trends reveal food impacts. Tune in for expert analysis on what these moves mean for the economy!

Doug Vissicchio, the Head of Municipal Sales at UBS, shares his insights alongside Daniel Close from Nuveen. They delve into the underperformance of 2025 in the muni market, exploring opportunities amid current challenges. A bullish outlook for 2026 is discussed, with predictions of $600B in supply and sustained inflows. They highlight the shift towards SMAs and ETFs, as well as the impact of technology on research. Vissicchio emphasizes improved liquidity and how upcoming Fed cuts might influence investor behavior in the market.

Germany surprises with a larger-than-expected trade surplus, driven by diminishing import demand. Meanwhile, global trade outside the US continues to thrive, aiding German exports. President Trump's proposed $12 billion farm support package raises eyebrows amidst concerns over tariff revenue, which has fallen short of forecasts. Grocery prices are on the rise, highlighting inflation's impact on everyday items. Additionally, weak UK retail sales signal caution for Black Friday. All this, while US job openings data draws attention for its significance in employment trends.

In a revealing conversation with Jason Draho, Head of Asset Allocation Americas at UBS, key insights emerge on the current economic landscape. He analyzes signs of labor market softness and rising layoffs while discussing trends in inflation, indicating a potential easing in Fed policy. Draho explains the concept of 'running hot' and its implications for GDP growth. He also offers market positioning advice, highlighting cyclical strength and preferred asset classes. Get ready for an informed look at upcoming economic data and the impact on investment strategy!

China's trade surplus soared past one trillion dollars, bolstering its growth ambitions amidst weaker domestic demand. Despite US tariffs, China's exports have shown resilience for several key reasons. Meanwhile, Germany surprised analysts with stronger industrial production, even as sentiment data lagged behind. Additionally, the podcast explores the current silence from the Fed and the intriguing developments around the Bank of England, highlighting the contrasting landscapes of manufacturing activity and sentiment.

Ulrike Hoffmann-Burchardi shares insights on turning macro headwinds into potential tailwinds for the coming year. She anticipates a likely Fed rate cut driven by lower inflation and a soft labor market. Improving consumer sentiment, especially among younger demographics, points to economic optimism. Exciting trends in AI demand are highlighted, showcasing innovative applications in commerce and healthcare. With supportive policies, there’s potential for a Santa Claus rally in equities by year-end.

Richard Bernstein, the visionary founder of Richard Bernstein Advisors, joins Jason Draho, the savvy Head of Asset Allocation Americas for UBS, to discuss future market dynamics and positioning strategies for 2026. They delve into the surprising GDP growth of 2025 and provide insights on the Fed's potential influence. Topics include the impact of AI on investment narratives and the importance of focusing on quality and dividend stocks. The guests also tackle the risks associated with bubbles and explore fixed income strategies favoring high-quality securitized assets.

Listeners dive into the perplexing world of US consumer data, where dated information complicates the real picture. Inflation rises as consumers slash their savings to maintain spending under economic pressures. The discussion touches on how political polarization skews consumer sentiment polling, adding layers to understanding public perception. Meanwhile, eurozone growth trends reveal challenges, and expectations for French and Spanish industrial production hint at ongoing resilience. It's a lively exploration of consumer behavior and economic signals!

In this engaging discussion, Leslie Falconio, Head of Taxable Fixed Income Strategy for the Americas at UBS, and Clayton Triick, Head of Portfolio Management at Angel Oak Capital Advisors, delve into the current landscape of Agency RMBS and the housing market. They highlight the attractiveness of agency MBS due to valuation and liquidity, explore the appeal of non-agency mortgages, and discuss innovative mortgage options like 50-year and portable loans. Their insights on consumer leverage and market dynamics provide a fresh perspective on today's financial opportunities.

The US labor market's dynamics take center stage, as low unemployment fears lead to decreased savings among consumers. This drop in savings has fueled recent price increases in the US. Important jobless claims data are under scrutiny after disappointing ADP payroll numbers. The limitations of ADP as a labor market indicator are discussed, with insights into how hidden unemployment can be masked. Meanwhile, the podcast touches on the complexities of AI hiring excuses amid policy uncertainty, and the impact of US trade decisions on China.