UBS expects global equities to extend their climb in 2026, with performance widening beyond technology into more cyclical parts of the market. Analyst Fabian Deriaz noted that cyclical regions and sectors are sharply outperforming, while the bank maintains an Attractive view on equities, supported by structural and macro catalysts.

The bank’s confidence stems from a rare mix of supportive monetary and fiscal policies across major economies, from the U.S. to Germany and Japan. UBS forecasts close to 12% EPS growth for next year, underpinned by easing tariff risks, anticipated Fed rate cuts, and pro-growth fiscal spending that should bode well for corporate earnings.

Looking ahead, UBS emphasizes diversification across regions and sectors, favoring banks globally and adding U.S. consumer discretionary to its list. The firm also recommends its new “Quant Pathways” strategies to enhance portfolio resilience as the rally broadens through 2026.