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UBS: Rate Hike And Increase In Oil Prices Will Be Good For The Overall Market


Julian Emanuel, U.S. Equity & Derivatives Strategy at UBS, has a year-end target of 2,225 target on the S&P 500. He was on CNBC Wednesday to discuss this call and how an increase in oil prices can move stocks up.

Economy Can Accelerate On Rate Hike

"The Fed has basically not given us a ton more guidance," Emanuel began. "We know what rate hikes are going to come and we actually think that when they come, the surprise could be that the economy actually accelerates and obviously, we think that's going to be good for stocks."

Timing Of Rate Hike Doesn't Matter

On whether he is not concerned with the timing of the rate hike, Emanuel said, "Whether it's September or December is not quite as important. Granted if there is a rally in the market between now and then, if it's a surprise and it does happen in September that could jolt volatility a little bit."

"But ultimately the message from higher rates is the fact that the economy is on firm footing, that the rest of the world is on firm footing and that is a positive for the economy."

Higher Oil Is Good

Emanuel was asked if higher oil prices will be a little good for the equity markets, He replied, "At this point it is good. Earnings in the energy sector are down substantially, sort of 60 to 65 percent year-on-year. And stability in the oil market would definitely be a positive for the S&P as a whole at this point."

Latest Ratings for UBS

Sep 2019UpgradesHoldBuy
Aug 2019DowngradesHoldSell
Jul 2019DowngradesSell

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