While the US earnings season has underpinned the equity rally, emerging risks – such as tariffs slowing the economy and fuelling price pressures – warrant investors’ attention. However, these risks remain insufficient to prompt a shift in our portfolio positioning, and we continue to maintain a broad diversification across asset classes.

Key investment themes

  • Technology and utility equities provide the strongest visibility
  • Our highest convictions in fixed income remain mortgage-backed securities (MBS), senior loans and AT1s
  • The broader trend points to sustained US dollar weakness
  • Gold’s secular rally still has room to run
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A month of trade deals

July provided a rich vein of agreements between the US and its trading partners as the 1 August tariff truce loomed. These deals, which limited tariff increases compared with the initial April announcement, are reducing uncertainty. The easing of concerns around the trade war is prompting investors – as we anticipated back in June – to shift their attention to macroeconomic indicators and companies’ results.

At time of writing, the earnings season is well under way, revealing strong results from tech companies, which is a trend likely to be sustained by the AI. However, the erosion of the equity risk premium, coupled with elevated valuations, remind us that the equity potential is limited, reinforcing the case for a diversified asset allocation where each asset class generates performance.

Read our August House View for more insights.

202508_UBP_House_View_August.pdf

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The opinions expressed herein are correct as at 7 August 2025 and are subject to change without notice. Any forecast, projection or target, where provided, is indicative only and is not guaranteed in any way.