UBS - S&P 500 Set For 9% Gain To 5400 UBS Ups Target: 'Higher Inflation Tends To Be A Positive For Stock Prices' | Benzinga
UBS has raised its S&P 500 target to 5,400, citing demand-driven inflation as a positive factor for stocks.
What Happened: UBS has increased its S&P 500 target to 5,400, the most bullish forecast yet, representing a 9% increase from current levels, reported Business Insider.
Despite the recent stock market downturn triggered by higher-than-expected inflation, UBS analysts view this as a positive sign for equities, especially since it is driven by robust consumer demand.
“Higher inflation tends to be a positive for stock prices,” said analysts led by Jonathan Golub. “While the market sold off on more robust CPI and PPI reports last week, our work indicates that these demand-driven readings are constructive for future returns.”
UBS pointed to strong consumer demand, backed by recent economic data such as consumer confidence, payrolls, and manufacturing data.
UBS had initially predicted a year-end figure of 4,850, which was ...