Investment bank warns: The decisive week that could shake the markets
UBS bank publishes a forecast ahead of the Federal Reserve's interest rate decision and reports from technology giants, as massive investments in artificial intelligence raise serious concerns among investors.
Investment bank UBS has published an updated review stating that financial markets are facing a decisive week, with investors focused on the Federal Reserve's interest rate decision, reports from technology giants, and developments in artificial intelligence. The bank estimates that the combination of these events may influence the direction of trading in the coming months.
According to UBS, the Federal Reserve is expected to leave the interest rate unchanged in the range of 3.50% to 3.75%. This assessment is based on the continued moderation of inflation, balance in the labor market, and the understanding that the recent rise in oil prices and the new tariffs of the Donald Trump administration are not expected to generate prolonged inflation.
At the same time, the bank points to question marks surrounding the field of artificial intelligence. Investors are awaiting financial reports from cloud and technology giants against the backdrop of concerns over the massive amount of investment required for the continued development of AI infrastructure. These concerns have already led to sharp declines in chip stocks in Asia, alongside reports of investments of hundreds of billions of dollars in computing infrastructure.
UBS further notes that developments in China, where a local company backed by the Chinese government has begun producing advanced equipment for the chip industry, may increase competition against Western companies and affect the balance of power in the sector.
Alongside this, UBS emphasizes that the situation in the markets is not solely negative. The bank maintains a positive outlook regarding the stock market for the next 6 to 12 months. Data from companies in the United States continues to indicate strong private consumption, and in Europe, there are signs of economic recovery, especially in Germany. Against this backdrop, UBS recommends that investors maintain a diversified investment portfolio, combining technology stocks with traditional sectors and different geographical regions, in order to cope with the expected volatility in the markets.
