JPMorgan Chase analysts predicted in a Thursday note, despite a steady pace of mildly encouraging data indicating softening inflation and an impending slowdown in the Federal Reserve’s most aggressive tactics in recent weeks.The JPMorgan team, led by Dubravko Lakos-Bujas, wrote it expects the S&P 500 to “re-test this year’s lows” in the first half of 2023, implying a 14% decline for the S&P from its Thursday level.
The bank cited a “proverbial snowball” of high borrowing costs, a deterioration in consumer savings and a rise in unemployment will contribute to the market’s poor start. But that stream of bad news should then inspire a Fed pivot to lower interest rates, according to JPMorgan, predicting the S&P will end next year at 4,200, a modest 3.6% gain from where it currently stands.
Several other banks also expect a tepid beginning to 2023 for the market, with UBS strategists predicting last month a “base-case” scenario of 3,700 for the S&P by next June, implying 9% downside, while Goldman Sachs analysts noted Monday the market is currently baking in only an 11% chance of a recession over the next year, compared to a 39% probability in Goldman’s market-based recession model.
Predictably, all eyes will continue to be on the Fed, which is largely expected to raise the federal funds rate a further 100 basis points in coming months, with JPMorgan analysts writing their forecast “largely depend[s] on the depth and length of the recession and the speed of the Fed’s counter-response.
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We headed down soon!
The Fed told us they would do QT for 3 years a few months ago plus raising interest rates to fight inflation ... the message and direction of the Stock Market is clear.
theyve been wrong 9 out of 10 times...will you bet on someone with a 10% chance to be right and extremely hurt that his business model belongs to the last century ?
Everyone just give Jamie Dimon all your money. He knows you will lose it, he doesn't care. He has other interests that are more important to him. So, you should be considerate of his feelings and just let him have it all.
Yeah it’s called a recession.
They’ve missed on all their other predictions, so I’m good with this one as well. Always trying to use scare tactics and never anything positive. Same ole same ole.. StocksInFocus StocksToBuy
Just by making a forecast they have discredited themselves. They have no idea which way the market is going or when it will change directions.
The bottom is not in… yikes.
Gonna buy some gamestop stock
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