The new crown has not gone, monkeypox has come again.

At the same time, recently, with the continuous high inflation and the increasing expectations of tightening monetary policies such as the Fed’s interest rate hike and balance sheet reduction, the U.S. stock market has entered a stage of adjustment. The sharp rise in prices has further amplified the volatility of overseas markets, and the VIX panic index $iPath S&P 500 Dynamic VIX ETN (XVZ.US)$ also has a pulse-like rise.

It is transmitted to the Hong Kong stock market, the Hang Seng Index (800000.HK) and the A-share market, and the market is still not calm recently.

In this context, how should ordinary investors invest? What opportunities are there to watch? In this regard, the latest views of leading asset management institutions with rich investment and research resources are of considerable reference value.

This issue brings the latest institutional views published by UBS Wealth, please refer to the following:

Energy crisis dominates Davos forum

The global energy crisis dominated this week’s World Economic Forum in Davos, Switzerland, where leaders of national and multilateral institutions and business leaders expressed concern about the impact on the world economy caused by the price spike. While there is no consensus on real-time solutions, the energy crisis shows the urgency of the global transition to renewable energy, and the reality of structural imbalances in fossil fuels requires short-term investments in polluting energy sources. Brent oil $Brent crude (cash) 2307(BZ2307.US)$ rose 3% yesterday to $117.4.

Saudi Aramco, the world’s largest oil producer, warned at the forum that under pressure from lobbyists advocating green issues, most companies are afraid to invest in the oil industry, and global oil supplies are facing a major crunch. Whether or not there is a conflict between Russia and Ukraine, problems arising from a lack of investment in the industry, especially during the pandemic, will emerge. Saudi Arabia also added that its inability to control the oil market meant it had no plans to ramp up production.

On the same occasion, the International Energy Agency said that the energy security crisis will in no way lead to an increase in the world’s reliance on fossil fuels. With the right investments in renewable and nuclear energy, the world does not need to choose between energy shortages and climate change. The agency warned investors last year against funding new oil, gas and coal projects, with the world on track to reach net-zero emissions by 2050.

Oil prices may hover at high levels

The Davos meeting drew global attention, but there was little consensus on addressing the energy crisis. Regardless, it highlights the dilemma the world is facing in tackling climate change. We believe that geopolitics highlights the need for an accelerated global transition to new energy sources. At the same time, the reality of structural imbalances means that energy prices may remain high in the short to medium term.

Saudi Aramco estimates that the global oil supply crunch will intensify as the aviation industry recovers faster. The IEA acknowledges that the world cannot be freed from traditional energy supplies immediately. The European Commission recently announced a €210 billion plan to cut off energy supplies from Russia by 2027, a plan that includes investment in traditional fossil fuels.

We believe the oil market is underestimating energy supply risks at this stage. The current structural imbalances in traditional fossil fuels are likely to persist due to years of underinvestment in the industry. As a result, Brent oil prices are expected to remain high for the year ahead, and we maintain our preference for the global energy sector. In the face of the risk of supply cuts, commodities are effective geopolitical hedging tools.

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