Marko Kolanovic, chief market strategist at JPMorgan Chase, saidCrashbandicoot52023Due to high interest rates, weak growth and meagre potential returnsCrashbandicoot52023It is difficult to justify buying stocks now.
"We don't think there are enough returns to prove the need to take stock risk at this time," Kolanovic told clients in a report on Monday.
The company reiterated its cautious view of small and medium-sized stocks, pointing out that between now and before the next recession, small and medium-sized stocks-- like large-cap stocks-- are unlikely to outperform returns on 20-year Treasuries.
Kolanovic said the market was returning to the narrative of a soft landing "prematurely"
"however, there is uncertainty about the macro outlook, and we are entering a seasonally difficult period of the year for the stock market, where inflation may remain too high, profit margins are under pressure and a combination of high positions is challenging."
Note: Kolanovic's view of the US stock market has not been realized for the third year in a row. The s & p 500 is up 9% in 2024, although he expects it to fall. The strategist was pessimistic during the stock market rally last year and bullish for most of the stock market crash in 2022.