UBS Switzerland AG Outlook on Swiss Equities – H2 2026

UBS Switzerland AG, through its Chief Investment Officer for Equity Strategy, Stefan R Meyer, indicated that the Swiss Market Index (SMI) has risen just over 10 % in the first six months of 2026, suggesting further upside potential for the second half of the year. The bank projects earnings growth of 8 % for Swiss listed companies in 2026, which aligns with the current consensus estimates, but expects earnings growth to slow to 5 % in 2027, a figure that falls below the consensus outlook for that year.

The SMI’s price‑to‑earnings (P/E) multiple is currently positioned between 17 × and 18 × based on consensus earnings estimates, marginally higher than the long‑term average of approximately 16 ×. UBS attributes the modest premium to the fact that SMI constituents have demonstrated profitability levels exceeding the average of the past two decades.

Manufacturing purchasing managers’ indices (PMIs) for both Switzerland and the United States have been above the 50‑point growth threshold since March, marking the first sustained expansionary reading in more than three years. This development signals a broadening of manufacturing activity across the two economies.

UBS also highlighted that the summer period—from June through September—typically exhibits heightened price volatility in the SMI. Consequently, the bank advises investors to view any pull‑backs during this window as buying opportunities rather than chasing short‑term rallies.

The Swiss market’s dividend yield is reported at roughly 3 %. In line with this, UBS recommends a focus on high‑quality companies with strong profitability, and suggests selective exposure to mid‑cap and cyclical stocks that can benefit from the anticipated market dynamics.

Key Figures

  • SMI gain H1 2026: >10 %
  • Expected earnings growth 2026: 8 %
  • Expected earnings growth 2027: 5 %
  • SMI P/E ratio: 17‑18 × (vs. long‑term 16 ×)
  • Dividend yield: ~3 %
  • Manufacturing PMI (Switzerland & US): >50 since March (first >3‑year occurrence)

Strategic Guidance

  • Treat summer‑season pull‑backs as entry points.
  • Prioritise quality, high‑profitability firms.
  • Consider selective mid‑cap and cyclical equities.