Geopolitics as a key market driver‍

The escalation in the Middle East is shaping the market environment. The conflict between the US/Israel and Iran caused the WTI oil price to rise temporarily to just under USD 120; it currently stands at around USD 90 per barrel. The de facto blockade of the Strait of Hormuz – through which around 20% of global energy flows pass – is increasing inflationary pressure and limiting monetary policy scope.Economy under pressure‍The Swiss economy will continue to grow below its potential in 2026, at around 1%. The strong Swiss franc and weak export demand remain a drag. We expect a moderate recovery in 2027.

Monetary policy in wait-and-see mode‍

Central banks are acting cautiously: the Fed remains at 3.5–3.75%, the SNB has cut to 0%, and the ECB is caught between inflationary pressures and weak growth. Interest rate cuts are on hold for the time being.

Capital markets: focus on selectivity

Equity markets remain fundamentally supported by solid earnings and structural themes such as digitalisation and AI. At the same time, volatility is rising and performance is becoming more selective. Alongside opportunities in China, Brazil and Switzerland, we favour US large caps with stable margins and sustainable cash flow.

Fixed income and gold‍

Bonds are gaining importance due to attractive current yields and duration. Investment grade remains key, whilst high yield requires selectivity. Gold remains supported, but is caught between rising real interest rates.‍