UBS Believes in Reflation, Sees Peak Inflation Now: Haefele

The video discusses the current state of the market, highlighting the yield of S&P 500 stocks compared to 10-year Treasurys, and the equity risk premium. It addresses concerns about inflation and its impact on stocks, particularly those positioned for reflation like energy, financials, and materials. The discussion also covers market volatility, momentum, and the rotation towards value sectors. Finally, it examines valuation disparities between sectors, emphasizing the need for strategic investment decisions.

What is one reason the S&P 500 stocks are yielding more than 10-year Treasurys?

• Increased bond yields

• Lower inflation-adjusted yields

• Decreased stock prices

• Higher inflation-adjusted yields

What is the expected increase in S&P earnings this year?

• 20%

• 50%

• 30%

• 40%

Which sectors are recommended for investment due to their positioning for reflation?

• Consumer goods and services

• Energy, financials, and materials

• Real estate and utilities

• Technology and healthcare

What is the predicted trend for inflation according to the central case?

• Inflation will remain stable

• Inflation will peak and then fall

• Inflation will continue to rise

• Inflation will decrease rapidly

What is the valuation disparity between S&P 500 and big cap tech stocks?

• Both are at 27 times earnings

• S&P 500 is at 27 times earnings, tech at 17.5 times

• Both are at 17.5 times earnings

• S&P 500 is at 17.5 times earnings, tech at 27 times