Traditionally, U.S equities have performed poorly in September as per the report.
September brings more seasonal challenges, elevated political and geopolitical uncertainty.
Traders and investors across the world are quite worried about JPMorgan’s recent comments on Fed rate decreases. Even if speculation about future interest rate reduction is at an all-time high. The head of global and European equity strategy at JPMorgan today downplayed the likelihood of a bull market. The announcement has quickly ignited worldwide debates with the stock and crypto market predicting significant adjustments ahead.
According to a recent Fortune post-dated September 3, Mislav Matejka’s team stated that any policy relaxation would be in reaction to slowing GDP, making it a “reactive” decrease. Expectations of rate reduction by the Federal Reserve are expected to increase during the September meeting. Which is the main reason for this remark by JPMorgan’s team.
More Challenges in September
According to the report, another challenge is the seasonal tendency; traditionally, U.S equities have performed poorly in September. Matejka warned them they were far from safe. September brings more seasonal challenges, elevated political and geopolitical uncertainty, and sentiment and positioning indicators that do not bode well, he stated.
Moreover, as investors braced for the Federal Reserve to begin slashing interest rates at its next policy meeting on September 17–18, the S&P 500 bounced back from its early August drop to hit a record high. Another global equities index that has just reached a record high is the MSCI All-Country World Index.
Despite continued market optimism, the JPMorgan team predicts that the stock market’s approach to a new high will be halted. This would be by the larger effect of the Federal Reserve’s rate decreases in September. The impending US employment data is also expected to cause more volatility in the cryptocurrency market.
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