economy
One European equity market stands out after bruising March sell-off, says UBS
The fallout from the ongoing war with Iran left its mark on every European equity market through March, though some have fared worse than others.
TL;DR
- The Iran war caused significant selling pressure across European equity markets in March.
- Britain's FTSE 100 performed slightly better than Germany's DAX and France's Cac 40.
- The Swiss Market Index (SMI) also experienced a substantial drop but showed signs of recovery.
- UBS analysts believe the Swiss equity market is well-positioned to benefit from a potential sentiment rebound.
- They highlight the defensive nature of Swiss equities, including healthcare and consumer staples, as a key strength.
- Swiss equities are characterized by high-quality companies, strong balance sheets, and resilient cash flows.
- Valuations for Swiss stocks are now considered attractive, especially compared to zero-interest Swiss franc bond yields.
- UBS has upgraded Swiss equities to 'attractive', contrasting with their neutral rating for European, Eurozone, and Indian equity markets.
- The firm is cautious on cyclical markets heavily reliant on imported fuel, such as those in Europe.