UBS Global Wealth Management has issued a warning to stock investors as tensions in the Middle East intensify. The bank is urging clients to reduce equity exposure and prepare for a potential market drawdown of up to 20%. The firm has reduced its recommended equity allocation to 50 percent from 65 percent, marking its most defensive stance since late 2022. The warning comes after Israeli strikes on Iranian nuclear facilities and a missile retaliation that disrupted key shipping routes. UBS warned that a prolonged disruption in the Strait of Hormuz could send oil above $120 a barrel, acting like a tax on consumers and slow global growth. The firm also cut its outlook on the financial sector to underweight and increased exposure to assets that perform better during periods of uncertainty.