JPMorgan Advises Hedging Recession Risk as Bonds, Stocks Diverge
- Volatility likely to increase with growth ‘not out of woods’
- Treasuries point to 70 percent of recession in a year: JPM
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Equity and credit markets have priced in much lower odds of a U.S. recession than Treasuries, a dislocation that’s likely to set up another rout of market volatility, according to JPMorgan strategists.
While manufacturing data in China has improved, global growth is “not out of the woods yet,” strategists led by Nikolaos Panigirtzoglou wrote in a note, urging investors to establish hedges against the possibility of a recession.