FTSE 100 could surge 19% or slump 26% depending on commodities and bonds, says UBS

UBS raised its outlook for the FTSE 100, saying UK blue-chip shares could rise about 9% from current levels and reach 11,000 by end-2026 and 11,300 by June 2027. The bank cites reasonable valuations, improving profit growth and an expected 11% earnings increase in 2026, led by commodity-heavy constituents. However, UBS still rates UK equities neutral, arguing other markets may offer better exposure to global recovery and faster-growing sectors. The note also highlights a wide dispersion of outcomes: in a bullish case with stronger growth, higher commodities, weaker sterling and more foreign inflows, the index could hit 12,300; in a bearish case with weaker growth, lower commodity prices, higher bond yields, trade tensions or a stronger pound, it could fall to 7,700. The report is likely to influence sentiment on UK stocks and commodity-linked names more than trigger immediate price action.