Latest news with #FabioBassi
CNBC
27-05-2025
- Business
- CNBC
How the stock market typically performs during the summer
Memorial Day weekend marked the unofficial start to summer in the U.S., a notable period for investors who like to, as the market adage goes, " sell in May and go away ." Interestingly, a look back over the last 50 years at the S & P 500 's performance shows the three-month stretch from the Friday before Memorial Day through to the Friday before Labor Day in September has mostly been positive for equities, according to Bespoke Investment Group. "The S & P 500's median performance during this period has been a gain of 3.7%, with positive returns 72% of the time," read a note from the firm. .SPX 6M mountain S & P 500, over 6 months In fact, a closer look at the numbers shows the gains are especially pronounced when the S & P 500 was already higher year to date heading into the period, with the benchmark notching a 4.3% gain on a median basis, with positive returns 74% of the time, the firm found. On the other hand, in the 15 years when the S & P 500 was lower on the year heading into the period, the index gained just 1.4% on a median basis, with gains 67% of the time. On a historical basis, at least, that suggests the summer months this year could be more challenging for stocks. On Friday, May 23, before the Memorial Day weekend, the S & P 500 closed lower on a year-to-date basis. On Tuesday, however, the broader index was last slightly higher for the year. Other Wall Street firms are already thinking gains could be capped this summer, given that investors won't be gaining any clarity around trade until the July tariff deadline. JPMorgan's Fabio Bassi, the bank's head of cross-asset strategy, said the S & P 500 could "remain rangebound, with limited short-term upside." However, others expect that means equity weakness is contained, especially if the stock market can get past some key hurdles around trade and the U.S. deficit. Canaccord Genuity's Michael Graham said he holds a neutral view on the short-term outlook for stocks, but said he sees "a pathway toward many of these risk factors dissipating later in the summer" if investors can avoid significant tariff volatility.
CNBC
27-05-2025
- Business
- CNBC
Don't expect the market to go anywhere this summer, says JPMorgan
Looking for another leg higher in stocks this summer? JPMorgan thinks investors should pump the breaks. Fabio Bassi, the bank's head of cross-asset strategy, warned the S & P 500 could "remain rangebound, with limited short-term upside." He added: "The rally to our bull case scenario of 5,800 for S & P 500 has played out, but from here we expect a consolidation and range-bound dynamic." Indeed, the S & P 500 has surged 20% since hitting an intraday low on April 7, as investor sentiment recovered after the "liberation day" tariff shock that sent global markets tumbling. The benchmark closed Friday's session at 5,802.82 (U.S. markets were closed Monday due to the Memorial Day holiday). .SPX YTD mountain SPX year to date The protectionist U.S. trade stance raised concern of persistent inflation — leading investors to lower their expectations for Federal Reserve interest rate cuts. CME Group's FedWatch tool shows traders see the central bank lowering rates twice in 2025. They expected at least three rate cuts when the year began. "The revival of the 'higher for longer' narrative, coupled with reduced tariff concerns, is likely to constrain the expansion of equity leadership," Bassi wrote. "Investors are expected to continue paying a premium for high-quality growth companies, resulting in an unhealthy concentration within the tech sector and the Mag7." The strategist recommended clients hedge against potential downside by buying call options on the Cboe Volatility Index (VIX) , essentially betting Wall Street's "fear gauge" will rise. But Wall Street is set to begin the shortened trading week on a strong note. S & P 500 futures popped more than 1% after President Donald Trump delayed a 50% levy on European goods until July. However, those gains are likely short lived, if JPMorgan's assessment is correct. Elsewhere Tuesday morning on Wall Street, Barclays became the first shop on Wall Street to downgrade CoreWeave since its IPO. The bank lowered its rating on the stock to neutral from overweight. The stock nevertheless added another 4% in premarket trading. "With its voice-A.I platform, SoundHound is a direct play on the A.I revolution," analyst James Fish wrote.
Globe and Mail
08-05-2025
- Business
- Globe and Mail
J.P. Morgan Warns Tariff Chaos Could Slash Global GDP 1% as U.S. Stocks Struggle
J.P. Morgan's (JPM) latest analysis on U.S. tariffs raises more questions than answers, especially when it comes to the global economic outlook. While President Trump's trade moves have been causing plenty of disruptions, J.P. Morgan analysts believe the impact is far from straightforward. The firm's commentary signals that tariffs might push global GDP down by 1%, but that could be just the tip of the iceberg. Protect Your Portfolio Against Market Uncertainty Discover companies with rock-solid fundamentals in TipRanks' Smart Value Newsletter. Receive undervalued stocks, resilient to market uncertainty, delivered straight to your inbox. Tariff Woes Could Lower Global GDP by 1% J.P. Morgan has warned that a global GDP reduction of up to 1% is possible if the trade war escalates, particularly with the U.S. slapping 10% tariffs on goods from all trading partners and ramping up those on China to 104%. Joseph Lupton, a global economist at J.P. Morgan, highlighted how the knock-on effects, including weakened business sentiment, could make this damage even worse. These tariffs could lead to higher costs for U.S. consumers, which, in turn, dampens spending and risks dragging both U.S. and global growth. S&P 500 Likely to Stay in a Tight Range Despite the trade war turbulence, J.P. Morgan's analysts aren't expecting an immediate crash in the stock market. Instead, they're forecasting a 'range-bound' S&P 500. Fabio Bassi, head of Cross-Asset Strategy at J.P. Morgan, said, 'We expect the S&P 500 to be constrained to the lower end of our range.' This sentiment echoes the concern that mixed tariff news, combined with President Trump's unpredictable moves, will keep markets in a holding pattern. Investors are bracing for a scenario where trade deals don't materialize quickly enough to boost sentiment. As indicated by the TipRanks graphic below, the S&P 500 has decreased by nearly 7% over the past three months. This drop reflects a turbulent market period (SPX). Investors are digesting the ongoing uncertainty surrounding tariffs and their global impact. Will a Recession Follow? J.P. Morgan Thinks It's Possible Adding to the uncertainty, J.P. Morgan's analysts see a 40% chance of a global recession by the end of 2025. Bruce Kasman, J.P. Morgan's Chief Global Economist, noted, 'The uncertainty surrounding tariffs is weighing on business confidence and could accelerate the push toward a downturn.' This isn't just about numbers on paper. The actual business sentiment has been dipping, and that means companies may hold back on investments and hiring. If that happens, it could further stifle growth and deepen the recession risk. Mixed Signals Make Tariffs More Complex Than Expected In a world where the trade policy landscape shifts almost daily, J.P. Morgan's analysis shows how tariffs are more than just taxes—they're changing the way the global economy works. In fact, GDP forecasts are being slashed and business confidence is at a low, this ongoing tariff drama is likely to have ripple effects for years. The situation remains pretty fluid, so its important to note that J.P. Morgan's cautious outlook paints a picture of a turbulent but range-bound future. The real question is, will things ever calm down, or are we stuck in this cycle?
