Bloomberg – An assessment of the state of the labor market in states that consider poor conditions for the economy, in fact, bullish signal for stocksAccording to strategists at JPMorgan Chase & Company (JPM)
The weekly data for initial applications for unemployment benefits is more than 10% above the three-month moving average. “Traditionally associated with recession in all respects”As he wrote this Tuesday in a note led by Strategists mislav matezka, Even then, The S&P 500 gained an average of 11% over the next 12 months, He indicated, citing information from the 1970s.
this group of strategists Companies are encouraged to continue to improve their earnings forecastswhereas Bet that the Fed will raise its last major interest rate hike next month, They have been the most bullish of all the pundits on U.S. equities in 2022, even as the S&P 500 struggled to maintain a rebound amid fears that sharp inflation and a buoyant Federal Reserve could fuel equity growth. will stop Economy.
for its part, The US benchmark experienced a vertical rebound in the summer, Even then, fell to its lowest level after a month about what Jerome PowellFederal Reserve Chairman, Last Friday rejected expectations of a change in monetary policy As long as there is no significant reduction in inflation. According to Matejka, Consumer prices are showing signs of reaching peak levels,
and though Business activity data also suggests the worst is yet to come As for the economy, corporate earnings continue to revise, which will improve the outlook for stocks, the strategist said. “During the last 2 or 3 months we were of the opinion that ,Bad data stream will look good and we believe that it is likely to continue,
their opposite point of view With strategists from Morgan Stanley (MS) and Bank of America Corp (BofA) (BAC), Those who expect higher interest rates for a longer period of time thereby putting pressure on profit margins, And Strong employment report for Augustwhich will be published this Friday, This could result in an even higher rate increase than expected. by the Fed next month, BofA strategists said on Monday.
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While stock market investors are concerned about the impact of slow growth on stocks,Ranking data shows they haven’t panicked yet, Although The S&P 500 has fallen since Powell’s comments on FridayCboe Volatility Index, known as Wall Street’s Fear Indicator, 25. has stopped near, lower than the other six cases this year when stocks experienced similar selloff. A rally in US stock futures on Tuesday also suggests that Investors look at latest pullback Concerns about central bank’s aggressive comments as exaggerated,
—With assistance from Farah ElBahrawi, Jessica Menton, Lou Wang and Jan-Patrick Barnert.
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