JPMorgan predicts 8% stock decline in 2024
In a new outlook from JPMorgan’s global equity strategy team, it is projected that the S&P 500 will finish 2024 at 4,200, representing an 8% decline from its current position. This forecast is in stark contrast to the more optimistic predictions of other Wall Street strategists.
The JPMorgan equity strategists, led by Dubravko Lakos-Bujas, cited a challenging macro backdrop for stocks in the coming year. They pointed to softening consumer trends and elevated geopolitical and political risks, along with richly valued equities and low volatility. Additionally, they expressed concern about falling household savings, high borrowing costs, and cooling global demand.
The team’s outlook also differs from projections of earnings growth. While Morgan Stanley’s Mike Wilson anticipates a rebound in earnings, JPMorgan is less optimistic, forecasting only a 2-3% increase in S&P 500 earnings compared to the prior year.
The JPMorgan team also highlighted the growing sentiment that the Federal Reserve’s interest rate hikes could slow the US economy in 2024. They noted a recent report from the Federal Reserve indicating a potential slowdown, as well as commentary from management teams during earnings calls suggesting a deteriorating outlook for consumers and the cost of credit.
Overall, JPMorgan’s outlook for 2024 is one of caution, as they express skepticism about the prospects for both earnings growth and economic conditions. Their predictions stand in contrast to the more hopeful assumptions of consensus growth on Wall Street.
As the new year approaches, investors will be closely watching these differing perspectives to inform their own strategies and decisions in the stock market.
For the latest stock market news and in-depth analysis, visit Yahoo Finance.