UBS strategist predicts S&P 500 surge despite soaring gold prices
Alan Rechtschaffen, a senior portfolio manager at UBS Global Wealth Management, remains optimistic about the stock market today despite gold prices climbing past $5,000 per ounce. He argues that strong equity gains and high gold valuations can coexist, even as investors turn to gold as a hedge against uncertainty and civil unrest.
Rechtschaffen sees the S&P 500 reaching 7,700 by the end of this year in his base-case scenario. In a more bullish outlook, he projects the index could climb to between 8,300 and 8,400. His long-term forecast places the S&P 500 at 7,000 points by the close of 2026.
The manager highlights three key themes driving market growth: artificial intelligence, longevity, and power. He believes these transformational forces will lift not just tech developers but also businesses and consumers across all sectors. Rechtschaffen dismisses the idea that rising gold prices must signal trouble for stocks. Instead, he maintains that both risk-on assets, like equities, and risk-off assets, such as gold, can appreciate together. His view challenges the traditional assumption that gold's strength always reflects market pessimism.
Rechtschaffen's projections hinge on the continued impact of AI, ageing populations, and energy shifts. His outlook suggests that even with gold at record levels, equities may keep rising. Investors will be watching whether these themes deliver the growth he anticipates.
