UBS On-Air: Market Moves

New York Federal Reserve President Williams—a genuine economist, who should thus be listened to —signaled that the Fed is happy with the state of the US economy and that two 25bp rate cuts this year would be appropriate. This clearer guidance for the future is a big improvement on Fed Chair Powell’s inept dependence on dodgy data.

On this week’s Snapshot, Jason reflects on the latest round of jobs data and weighs what a better-than-expected growth outlook means for the Fed’s monetary policy course into 2025. We also spend time outlining CIO’s current allocation views and guidance. Featured is Jason Draho, Head of Asset Allocation Americas, UBS Chief Investment Office. Host: Shiavon Chatman

The US employment report last week was wrong, because the data always is. However, the general direction of US employment signals an economy very far from “recession”. However, voters do not think about abstract concepts like GDP, have a distorted view of price levels, and believe that pay increases are due to them working harder. While the reality is people have a higher standard of living for the same amount of work, the perception is people are working harder to stand still.

As we close out the trading week, Brian and Paul weigh in on the latest jobs data, and what it means for the health of the US economy, along with the course ahead for monetary policy. Plus, we review CIO’s current allocation recommendations, and preview what you can expect in the week ahead. Featured is Brian Rose, Senior Economist Americas, and Paul Hsiao, Asset Allocation Strategist Americas, UBS Chief Investment Office. Host: Shiavon Chatman

It is US employment report Friday, the monthly celebration of dubious quality data that always thrills markets. Looking at the broad picture of the US labor market, the position is what it has been all year. Firms are slower to hire, but not keen to fire. This gives job security, and supports consumer spending patterns.

On this episode of Viewpoints, Burkhard turns focus to the notable rally across Chinese markets in recent time, and speaks to how investors should interpret the move, along with shares investment lessons to consider.

The economic calendar is strewn with irrelevancies in the form of business sentiment opinion polls. For-profit polls crave the oxygen of publicity, but neither their profit motives nor the attendant media attention are guarantees that they reflect economic reality. Partisan bias, inaccurate answers to questions, and falling response rates are all challenges to the usefulness of surveys (of any kind).

Mark Haefele, the Global Wealth Management Chief Investment Officer, teams up with Kiran Ganesh, Jason Draho, and Carolina Corvalan to dissect market dynamics. They dive into the implications of a potentially divided Congress on trade and tax policies. The conversation includes the Federal Reserve's recent rate cut and its impact on fixed income investments. They also discuss how electoral volatility affects market behavior and offer strategies for capital preservation amid changing interest rates and inflation pressures.

Markets have responded to escalating violence in the Middle East. Overnight missile attacks by Iran against Israel differed from those in April—there was less warning, and faster missiles were used. Israeli Prime Minister Netanyahu has pledged retaliation. Investors have seen this as a more serious escalation, and oil prices have risen. However, even at higher levels oil prices are still near the lows for the year. This limits the economic consequences for now.

Alejo Czerwonko, Chief Investment Officer for Emerging Markets Americas at UBS, shares insights on the impact of the Federal Reserve's easing policies on emerging markets. He discusses how rate cuts are enhancing financial conditions and making dollar-denominated bonds a prime investment choice. The conversation delves into Latin America's struggle to harness emerging opportunities, Brazil's challenges, and the promising outlook for investments in Argentine, Brazilian, and Colombian assets, underlining the potential for significant returns.