Tareno View October 2025

A promi­sing start to the fourth quarter

The global economy is once again proving its resili­ence, despite high US tariffs and political uncer­tainty. As the Fed resumes its easing course, corpo­rate profits are recei­ving an additional tailwind. The signs are there­fore good that share prices will continue to rise. There are still many stocks worth buying, for example in the health­care sector, where struc­tural growth and solid balance sheets are convin­cing. The downside of monetary easing is falling yields on liqui­dity and bonds. This increases the importance of alter­na­tive invest­ments in portfo­lios. Fortu­n­a­tely, there are also diverse and promi­sing invest­ment oppor­tu­ni­ties here, as you can read in the last part of our Tareno View.

Macroe­co­nomic environ­ment

The Teflon boom

Despite all the adver­si­ties of recent years (real estate crisis in China, war in Ukraine, wave of infla­tion, record rise in interest rates, concerns about sovereign debt), the global economy is growing steadily at around 3% per year. Although the tariff shock is also leaving its mark, it can hardly cause the global economy to falter. Count­ries parti­cu­larly affected, such as Switz­er­land, are also proving resilient and should avoid a reces­sion even if the tariff rate of 39% remains unchanged.

On September 17, the US Federal Reserve lowered the key interest rate by 0.25 percen­tage points in antici­pa­tion of a possible stronger economic slowdown. At the same time, it signaled further interest rate cuts this year and next. The leading central bank has thus given the green light for a conti­nua­tion of the global cycle of interest rate cuts.

The European Central Bank and the Swiss National Bank are likely to have ended their cycle of interest rate cuts for the time being. With the expected further cuts by the US Federal Reserve and the resul­ting melting away of the interest rate advan­tage, the US dollar is likely to continue the depre­cia­tion that began at the start of the year.

A look at the purcha­sing power parity shows that the US dollar is still overva­lued despite the recent devalua­tion. In view of the incre­a­sing loss of confi­dence, a valua­tion premium against the Swiss franc does not appear justi­fied and a struc­tural weake­ning of the USD is likely.

Market commen­tary

Good prospects

Despite customs uncer­tainty, global profits continue to grow robustly, led by the US techno­logy leaders. These are benefiting from the unbroken tailwind of artifi­cial intel­li­gence. As AI invest­ments are expected to continue to rise signi­fi­cantly in the coming year, AI stocks are likely to remain the driving force on the stock market, with positive spill­over effects along the entire value chain.

For the coming year, we expect earnings growth to be more broadly supported by additional sectors. Interest rate-sensi­tive sectors in parti­cular should regain momentum after a long dry spell. In view of the histo­ri­cally high valua­tion diffe­rences, we believe it makes sense to review the sector alloca­tion. We prefer a diver­si­fied alloca­tion to the cluster risks of many indices.