Asset managers: Federal Council has exaggerated with regulation
Independent asset managers in Switzerland are unanimous: local banks are threatened by overregulation, the US economy is overestimated on the stock market, and now is a good time to dry up profits.
After a majority of independent asset managers in Switzerland clearly stated three months ago that a UBS moves abroad would be bad for them, they are now also unanimously of the opinion that the Federal Council is overdoing it when it comes to banking regulation. A full 67 percent of the external asset managers (EAMs) surveyed are of this opinion (cf. graphic below).
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This is clear from the latest AVI-Index The Swiss Aquila Group, in collaboration with finews.ch quarterly survey. It summarizes various forecasts and assessments from independent asset managers in Switzerland. A total of 150 companies took part in the latest survey.
Trade tariffs move the markets
Asset managers are also clearly of the opinion that the issue of trade tariffs will once again have a significant impact on the markets; 60 percent of respondents share this view (cf. graphic below).
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And their assessment of the markets has deteriorated slightly. Only just over half (55%) of survey participants still expect the Swiss Market Index (SMI) to rise over the next three months, while 17% expect prices to fall (cf. graphic below). Three months ago, the figures were 56% and 13% respectively.
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Risk of price corrections in the USA
"We currently have mixed feelings about what is happening on the stock markets. Many market participants are displaying an astonishing lack of concern. Geopolitical risks are constantly increasing worldwide," says Daniel RöschHead of Investment Center & Investment Consultant at DC Bank in Berne.
"We also believe that the market is overestimating the state of the US economy. Since the turbulence in April, US stock market valuations have reached a high level again. The risk of price corrections in the second half of the year has increased. Against this backdrop, it may be worthwhile to lock in some of your profits and rebalance your portfolio," Rösch continues.
European equities with outperformance
Against this backdrop, it is interesting to note that 55% of the asset managers surveyed believe that the "outperformance" of European equities over US stocks will continue (cf. graphic below).
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"Given the already negative bond yields - the Swiss have negative yields for maturities of up to four years - we remain constructive on the Swiss equity market and are convinced that an overweight in high-dividend Swiss blue chips will pay off in the medium term," says Silvio Zagnoli, Co-Founder and Managing Partner of Capicura Partners in Zurich.
He adds: "For a possible stagflationary environment, we are tactically invested in silver in addition to a strategic gold position. Silver is experiencing a technical breakout and has further potential to catch up with gold."
The next AVI Index will be published at the beginning of October 2025.
Disclaimer: Produced by Investment Center Aquila Ltd. Information and opinions contained in this document are gathered and derived from sources which we believe to be reliable. However, we can offer no under-taking, representation or guarantee, either expressly or implicitly, as to the reliability, completeness or correctness of these sources and the information pro-vided. All information is provided without any guarantees and without any explicit or tacit warranties. Information and opinions contained in this document are for information purposes only and shall not be construed as an offer, recommendation or solicitation to acquire or dispose of any investment instrument or to engage in any other trans action. Interested investors are strongly advised to consult with their Investment Adviser prior to taking any investment decision on the basis of this document in order to discuss and take into account their investment goals, financial situation, individual needs and constraints, risk profile and other information. We accept no liability for the accuracy, correctness and completeness of the information and opinions provided. To the extent permitted by law, we exclude all liability for direct, indirect or consequential damages, including loss of profit, arising from the published information.
Independent asset managers in Switzerland are currently facing a difficult market situation. Many assets are proudly valued after the bull market in the current year, while at the same time the geopolitical fragmentation of the world does not make it easy to make the right investment decisions, as the latest edition of the AVI Index shows.
In Switzerland, consumption remains the mainstay of the economy, while foreign trade is slowing growth. Inflation is close to zero.
Germany has probably overcome the recession and moderate growth of 1.3-1.4% is expected for the coming years. The EU-US trade agreement further improves the outlook.
In the USA, the figures are contradictory and a shutdown is looming.
The SNB and ECB are keeping their key interest rates unchanged at 0% and 2.0-2.4% respectively. Forecasts point to a slight rise in inflation.
The Fed is continuing its cycle of interest rate cuts due to weaker labor market data and probably also political pressure. Further interest rate cuts are expected.
The mood on the global bond markets is calm and yields are barely moving.
The most important stock markets remain close to their highs as market breadth declines. Individual technology stocks are coming under pressure.
The decline of the US dollar has been interrupted, but further weakness could follow in the medium term.
Gold reflects the loss of confidence in the US dollar.
US GDP contracted slightly in 1Q25, but a strong recovery is expected for 2Q25. The high fluctuations in net exports are responsible for this.
The SNB is lowering its GDP forecast for '25 and '26 slightly to 1-1.5%, but expects unemployment to rise only slightly.
Escalating geopolitical risks and the USA's aggressive customs policy are putting pressure on global growth and could fuel inflation.
The central banks deliver in line with expectations. The Fed warns of weaker growth and rising inflation. The ECB believes the inflation target has been reached and the SNB shows
are reluctant to accept negative interest rates.
The Israeli attacks on Iran have led to the familiar pattern of "flight to safety" on the bond markets.
Following the significant recovery, things could now become somewhat more difficult on the stock markets.
The depreciation of the USD is picking up speed again due to the continued withdrawal of capital from the USA.
The scenario for gold is almost perfect. We remain constructive on the yellow metal.
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