Core Viewpoint - UBS's trading department believes that the decline in the U.S. stock market may have come to an end, setting the stage for a year-end rebound [1] Group 1: Market Outlook - Michael Romano, head of equity derivatives hedge fund sales at UBS, anticipates that the S&P 500 index will rise to 7000 points by the end of the year [1] - The market turbulence in November is seen as having sufficiently adjusted positions, which is expected to favor a resumption of positive market conditions [1] Group 2: Sector Performance - Strong performance from Nvidia is highlighted, along with political support for chip exports, indicating a favorable environment for the semiconductor sector [1] Group 3: Fund Flows - The flow of funds into systematic funds appears to be stabilizing, with volatility-controlled funds having resumed buying operations [1]

Group 1 - The core viewpoint of the article highlights that despite the recent rise in the U.S. stock market, key support forces are showing signs of weakening, leading to potential risks in September [1][21] - Retail investors have been a significant driving force behind the recent rebound in the U.S. stock market, with net buying occurring on 27 out of the last 28 trading days [4][20] - Systematic funds, which have injected over $365 billion into global markets in the past 75 trading days, are nearing their capacity limits, which may reduce their role as stabilizing buyers [9][12] Group 2 - Historical data indicates that retail trading activity typically peaks in June and July, then declines in August, reaching its lowest point in September, suggesting a loss of a key buying force [6][16] - The article warns of a "support vacuum" as retail buying wanes and institutional buying exhausts, particularly in September, which is historically the worst-performing month for the S&P 500 index [2][17] - Despite strong earnings reports, with 85% of companies exceeding expectations, these positive factors may not be enough to counteract the dual pressures from funding and seasonal trends [20][21] Group 3 - The article emphasizes that the market's ability to withstand negative macroeconomic news will be significantly weakened, preparing investors for potential higher volatility [3][21] - The article also notes that volatility control strategies may see a slowdown in buying demand due to recent increases in volatility, while risk parity strategies are returning to historical levels [13][14]