UBS: The Fed's upcoming rate cut could boost the stock market.
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TL;DR
UBS notes that historically, the S&P 500 averages 15% annual returns when the Fed cuts rates outside recessions. They expect a favorable macro environment and strong earnings to support stock gains early next year.
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UBSFederal Reserveinterest rate cutstock marketS&P 500
On December 11, UBS pointed out that historically, the stock market performs best when the Federal Reserve cuts interest rates during non-recession periods. Data since 1970 shows that the S&P 500 has achieved an average annualized return of 15% when the economy is not in recession and the Fed cuts rates.
UBS stated, "We believe the macroeconomic environment is likely to remain highly favorable into early next year, supporting the next round of stock market gains amid strong corporate earnings." (Jinshi)