The investment bank has selected a number of stocks that have the potential to navigate a still challenging market environment
The markets are facing months characterized by slow growth and inflation still above the targets of the central banks. A complex context, therefore, for investors, expected from a year of slowflation. Investment bank UBS (UBS Group AG) has therefore identified the global stocks to prefer in such an environment, with a forecast of global growth of 2.6% in 2023 (lower than the average of 3.5% over the last 50 years). The latest data on headline inflation show cost of living rising by 6.9% in March, still down from 8.5% in February. However, the UK unexpectedly experienced double-digit inflation due to soaring food and energy prices.
BEAT THE MARKET
According to UBS strategists, the prospect of a 2023 in the sign of "slowflation" is on the rise. After analyzing market history for patterns common to past periods of slow inflation, the bank identified a handful of stocks that could beat the market under similar conditions. UBS has identified stocks that could outperform under these conditions, taking into account historical trends, current earnings and valuation dynamics, as well as the views of its equity analysts.
THE SELECTED TITLES
The list includes sectors such as energy, utilities, consumer staples and healthcare stocks. According to UBS, banks are the best performers among financials, while retail performed well in all regions except Europe. Among the stocks with the greatest upside potential are Ryanair RYAAY (Ryanair Holdings plc-ADR) (+29.3%), Svenska Handelsbanken SHB-A.ST (Svenska Handelsbanken ser. A) (+25%), Shell SHEL (Shell PLC (ADR)) (+22%), Derwent London $DLN.L (Derwent London PLC) (Derwent London PLC) (+15.9%), BP $BP.L (BP) (+13, 3%), Rotork $ROR.L (Rotork PLC) (+12%) and Whitbread $WTB.L (Whitbread) (+9.9%).... Show More
