The investment bank has flagged better momentum in retail, housing and credit following the Reserve Bank of Australia's (RBA) interest rate cuts at its past two monthly meetings, bringing the official cash rate down a total of 50 basis points to 4.25 per cent.
UBS' view stands out from others in the market who agree that Australia's economy will post solid, if not robust growth in 2012 but believe the economic cheer will not spread to stocks.
"We're tactically neutral at the global level but we're strategically positive on equity markets so, from an allocation globally, we are looking for the appropriate point to become more optimistic on equity markets - and our price targets are all punchy by the end of 2012," Haslem said.
MERRILL Lynch strategist Tim Rocks has some bad news for those who hope equity markets will fare better next year. Merrill is cutting its 2012 forecast for the ASX 200 from 4500 to 4200. That's right. His updated forecast is now 10 points below yesterday's close of 4190.
Take some comfort from the knowledge that his forecast sits at the very bottom of strategist estimates because you will take very little from the construction of his arguments.
In a sneak preview of his next quarterly outlook, due to be released in January, Rocks told The Weekend Australian that profit forecasts of 19 per cent for 2012 were fantasies of analysts and would not be fulfilled.For the latest updates on the stock market, visit Stock Market Today
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