Sergio Ermotti, CEO of UBS
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UBS President Sergio Ermotti told CNBC on Wednesday that the results of the upcoming elections in the world’s major economies will ripple through global markets no matter who wins the White House.
“The outlook for the fourth quarter is obviously still affected by the uncertainty that we’re seeing on the macroeconomic and geopolitical front, and there’s an election coming up in the U.S., which is certainly not going to be a quiet thing,” he told CNBC’s Annette. Weisbach as UBS third-quarter profit prints shattered analysts’ forecasts.
According to UBS’s geographic segmentation, the U.S. is classified in the key Americas region, which is critical to the bank’s global wealth management performance, with third-quarter net income of $2.84 billion.
“We do expect there will be some volatility in the market regardless of who wins and what the outcome is. It remains to be seen how investors will react,” Ermotti added.
Markets are gearing up as voters flock to the polls on November 5, with the United States possessing both the world’s most important reserve currency and the largest stock exchange by market capitalization. Election jitters and expectations of further rate cuts from the Federal Reserve have prompted investors to turn to gold. Regroup A new record was set on Wednesday. Meanwhile, the yield on the 10-year U.S. Treasury note, also a safe-haven asset, gave up some gains earlier on Wednesday. three month high at the beginning of this week.
“None of these results are positive growth for us. During (Donald) Trump’s presidency, we thought it would lead to inflation because of his focus on immigration and tariffs. But we didn’t see anything particularly positive. Growth-friendly results are why bonds have been performing the way they have been, Arun Sai, senior multi-asset strategist at Pictet Asset Management, told CNBC’s “Squawk Box Asia” on Tuesday. Noting that the market has “more or less priced in the impact of Trump’s election as president.”
Democratic nominee and Vice President Kamala Harris is seen as the spiritual successor to current White House leader Joe Biden, whose one-term economic legacy was led by the Inflation Reduction Act and the CHIPS and Science Act. defined. Meanwhile, Republican candidate and former President Donald Trump’s top policies are best remembered for reshaping trade relations with China through a series of tariffs. European leaders expect some degree of U.S. trade protectionism No matter who has the upper hand.
locked in a fierce competitionnonetheless, both nominees are likely to implement policies that deepen America’s already massive economy. $1.8 trillion budget deficitThe International Monetary Fund estimates that this number will reach 7.6% of the country’s GDP by the end of this year. Congressional Budget Office predict The deficit could reach $2 trillion by 2024 – equivalent to 7% of GDP this year – and $2.8 trillion by 2034.
“In general, we are concerned that public debt and government debt are increasing around the world,” Ermotti noted. “So this is not just a problem specific to the United States. I believe we have to analyze the situation accurately as it arises. I don’t Don’t expect any immediate changes, but it will play out over time.”
T. Rowe said the Biden administration’s approach to the banking industry is one of “increased scrutiny, increased intervention and a push for expanded regulation of non-bank financial companies” and that financial regulation is likely to be “more proactive and engaging” if Harris wins. Gilad Fortgang, Associate Analyst September noticed.
The Biden administration dealt with a mini-banking crisis last year with the collapse of Silicon Valley Bank and Signature Bank. thenBiden urged regulators to restore safeguards for banks with assets between $100 billion and $250 billion and tighten oversight of financial institutions.
Asked how UBS is positioning itself to deal with post-election volatility, Ermotti said: “We are in close contact with our clients to help them navigate these uncertainties. From a bank perspective, we are ready We’re well prepared to handle any environment. Very strong capital (and) a very strong balance sheet position allows us to stay close to our customers.
