UBS Securities Trading Department Says the Rotation of Funds Out of U.S. Stocks May Have Come to an End

Jinse Finance reported that the trading division of UBS Securities believes the decline in the US stock market may have come to an end, laying the foundation for a rebound by the end of the year. Last week, the stock market experienced a sharp drop as investors' expectations for further easing by the Federal Reserve wavered and they exited crowded artificial intelligence trades. The S&P 500 Index and Nasdaq 100 Index have fallen about 4% and 7%, respectively, from their record highs set in late October, with both dropping to their 100-day moving averages. However, as the benchmark indices found support at this key technical level, systematic fund selling has largely subsided, and market expectations for a Fed rate cut next month appear to be back on track. UBS believes there is still room for the stock market to rise further. Michael Romano, Head of Equity Derivatives Hedge Fund Sales at UBS Securities, wrote in a report released on Sunday, "We believe the current phase of risk aversion has come to an end."