The more aggressive line by central banks adds to headwinds for economic growth and equities. Economists at UBS have lowered their S&P 500 forecast to 3,900 by December.

Euro Stoxx December target cut 15% to 3,400

“We now anticipate less upside for stocks this year, with slowing economic growth weighing on profit growth and higher bond yields depressing valuations. This combination implies less upside for the S&P 500 Index, and we have lowered our base case December price target to 3,900.”

“In the eurozone, growth momentum is slowing, while renewed uncertainty about the future of Russian gas supplies and the risk of bond market fragmentation are adding to macro risks. As a result, we have cut our base case December Euro Stoxx 50 targets by 15% to 3,400.”