97 days ago • Posted by Charles-Henry Monchau

JP Morgan bullish call on U.S equities. Target 4,500 for the S&P 500 by the end of '21

JP Morgan thinks the equity market has one of the best setups for sustained gains in years. According to their Chief US equity strategist, the road is clear for 4500 in S&P 500 by December 2021. Here are the 7 main reasons behind this bullish call: 1) key risks subsiding (e.g. US elections, pandemic and vaccine news, etc.); 2) Central bank policy continues to be accommodative and a major pillar of support for equity multiples; 3) Expect some incremental fiscal stimulus; 4) Less incremental negative headlines on issues of trade; 5) Positioning has been light and below average levels for systematic quant but also discretionary investors given stubbornly high market volatility. They expect continued volatility compression in the coming months to drive a mechanical re-leveraging process further supporting equity multiples; 6) Corporates will likely deploy incremental capital towards M&A and buybacks; 7) Earnings expectations still have room for upside surprise with 2022 growth likely pulled forward to 2H21. - source: JPM, The Market Ear 

S&P 500 roadmap by JP Morgan