BlockBeats report: On September 8, U.S. non-farm payroll employment increased by 162,000 in August, significantly exceeding the market expectation of 55,000 and marking the largest gain since March, while the unemployment rate remained at 4.1%. Following the data release, market expectations for a 25-basis-point Fed rate hike in September rose to approximately 60%. UBS believes that, compared to whether to hike rates, the underlying reason for the hike—whether driven by economic strength or inflationary pressures—is more critical for investment portfolios.
UBS remains bullish on global equities, recommending that investors take advantage of volatility to buy on dips while earnings prospects remain strong, with a preference for themes such as AI, power and resources, and longevity. Regarding bonds, UBS no longer recommends locking in yields on short- to medium-term bonds as a cash alternative, but believes the higher yields on high-quality long-term bonds present attractive allocation opportunities.
UBS stated that tight monetary policy in the context of a strong economy may prolong the dollar’s strength through capital inflows and relative economic performance; investors can reduce excess dollar positions during periods of dollar strength. Gold may face short-term pressure from rising real rates and a stronger dollar, but it remains a viable long-term hedge and diversification tool—investors may consider building positions after a price pullback. (GoldTen)