UOB Neutral On Stocks, Overweight Gold Amidst Market Turmoil

Editorial Staff

8 April 2026

UOB Asset Management is neutral on equities relative to benchmarks, overweight gold and underweight cash against a backdrop of geopolitical turmoil.

The asset management arm of Singapore-headquartered – overseeing S$43.4 billion ($33.8 billion) in assets as at the end of February – also stresses diversification and selectivity in equities, and remains diversified across fixed income, it said in a note that sketched out three broad scenarios for the global economy.

The firm, along with peers, is trying to figure out asset allocation as global energy markets and others are roiled by the war between US/Israel against Iran. Oil prices have surged as Iran closed off the Strait of Hormuz, raising question marks over global growth.

UOBAM said global growth and corporate earnings expectations remain broadly constructive across major regions, underpinned by continued investment in artificial intelligence, energy and infrastructure. However, recent geopolitical developments – particularly in the Middle East – have materially increased uncertainty, raising the risk of energy-market disruptions, renewed inflation pressures and higher market volatility.

The Iran conflict is “no longer a single-outcome risk,” it said.

In a 40 per cent probability scenario, geopolitical tensions ease, allowing energy prices to stabilise, inflation pressures moderate, and risk assets recover. Another 40 per cent probability scenario assumes prolonged disruption, leading to heightened volatility and downside risks to economic growth and markets.

In a lower probability (20 per cent), but more severe scenario, the conflict escalates, and recession risks rise materially, the firm said.

"While geopolitical outcomes remain difficult to predict, markets are likely to focus less on political intent and more on the implications for economic stability, inflation and risk premiums,” Anthony Raza, head of UOBAM Multi-Asset Strategy, said. “As a result, investors are reassessing the reliability of the global policy and security environment, increasing the likelihood of structurally higher risk premiums and reinforcing the need for more cautious, resilient and diversified portfolio construction."