JPMorgan Analysts Believe The Worst For …
JPMorgan analysts say the worst for risky asset markets may be behind
JPMorgan Chase Bank Analysts & Co. argue that most risky assets, which include, for example, stocks and cryptocurrencies, have already passed the minimum point during the current market crash.
According to Bloomberg, the conditions set by analysts for the stabilization and recovery of the markets were mostly met. This is facilitated by a change in the positioning of investors and extraordinary incentives by the authorities. Nevertheless, the coronavirus pandemic remains an unpredictable factor, as the number of infections in Europe and the United States remains at high levels, despite a certain “slowdown”.
“Risk markets should remain volatile as infection levels create uncertainty about the depth and duration of the COVID recession. However, there have been enough fundamental and technical changes to justify the selective addition of risk, analysts write. “The most risky markets are likely to hit their lows for this recession, with the possible exception of oil and some emerging market currencies, which are discouraged by debt sustainability concerns.”.
JPMorgan analysts expect most risky assets to trade higher in the second quarter of this year, and recommend that investors average oversold markets, looking primarily at those where central banks buy directly.
David Costin of Goldman Sachs Group Inc., however, expects the markets to decline further over the coming weeks. He cited a list similar to JPMorgan’s criteria, but came to different conclusions..
Anatol Kaletskiy from Gavekal Research Ltd. said it was too early to buy stocks, citing “surprisingly relaxed” investor sentiment and historical data showing that a bear market almost never ends with one massive sell-off without retesting lows.
At the same time, JPMorgan noted that investors should not rush to enter all markets that may seem cheap to them, and always consider the ratio of risk to potential reward..
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