JPM predicts stocks to re-test 2022 lows with risk sentiment reversal.

JPMorgan analysts have reiterated their cautious stance on US equities, stating that the market is too optimistic despite a rising interest rate environment, a major banking crisis, an oil shock, and a declining dollar. They believe that the risk sentiment will turn negative, ultimately pushing the market towards last year’s lows “over the coming months.” In this type of environment, investors should be underweight stocks and favor Defensives vs Cyclicals.