UBS Investment Bank reports that it is moving to an overweight position in global equities for the year ahead.

The firm notes that it sees a soft landing in the U.S. and global economies in 2008. Earnings growth should slow but remain positive, it says, adding that mid-single digit growth is more likely than the double digit growth that has been the case in prior years (and that bottom-up estimates expect). UBS anticipates downgrades to earnings growth estimates for 2008.

It also says that economic growth will also slow in the rest of the world, leading to a slowing of final demand growth. But, it believes that global GDP will stay near to its historic trend.

It is looking for a 10% return on equities next year. “The principal driver of this, however, will move away from earnings growth, towards modest multiple expansion,” it says.