Don’t follow global panic and sell stocks just yet, says UBS. Improving global growth and earnings, plus a continuation of gains in emerging markets, will for now outweigh concern about tighter monetary policy, according to the Swiss brokerage. It says Friday’s steepest drop in US stocks since September 2016 should be judged in the context of the S&P 500 index trading without a decline over 5 per cent for more than 400 days, the longest streak since the 1950s. “We don’t believe that now is a time to reduce exposure to stocks,” Mark Haefele, global chief investment officer of wealth management at UBS, said in a note. “As long as the recent rise in bond yields moderates, we are confident that market conditions will remain orderly.” Futures on the Dow Jones Industrial Average sank as much as 1.1 per cent on Monday. Speaking on CBS’s Sunday Morning, outgoing US Federal Reserve Chair Janet Yellen said US stocks and commercial real estate prices are elevated, but stopped short of saying they are in a bubble. Before last week, a steady rally powered partly by optimism over US President Donald Trump’s tax cuts pushed equity valuations to some of the highest levels since the internet bubble. “If bond yields continue to rise at the recent pace, if inflation data starts to accelerate further, or if central banks start to send more hawkish signals, we may need to revisit this outlook,” Haefele said.