JPMorgan Says Stocks Can Reach New Highs Despite Yield Inversion
- Stock returns average 10% in 12 months after inversions: JPM
- Macro-economic conditions different this time, strategists say
This article is for subscribers only.
Don’t fret too much about the yield curve inversion, says JPMorgan Chase & Co. Stocks can still climb to new records.
Equities around the world plunged last week after the key U.S. 2-year and 10-year yield curve briefly flipped for the first time since 2007, spurring fears of an economic downturn. But this correction is likely to be short-lived and U.S. stocks will recover as soon as early September, say JPMorgan strategists led by Mislav Matejka, as stimulus from major central banks outweighs worries about a slowdown.