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JPMorgan Sees Path To S&P 8,000 On ‘FOBO’
Were you curious as to what America's largest bank expects for US equities in 2026?
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Personally, I like TINA.
Based on JPM’s targets, we should aggressively re-allocate from the S&P 500 to ex-US markets, which have equal or better upside, are lower valued, way less exposed to an AI slump, and offer possible FX gains as the Fed cuts and cuts.
“Crack-up-boom” or just “Boom.” The bear case I keep wrestling with is a lost long end, Fed loses credibility (which is already happening), and equities rocket up on panic buying to escape inflation. Both scenarios say stay out of credit duration and junk.
“Low credit risk profiles”, yes for the AI leaders but is their AI onslaught low risk. How many winners can there be and computer tech is famous for the curveballs that magically appear. I’m no tech geek, but quantum computing seems like it could be a threat to the current strategy. If quantum computing overcomes its error problem, will that make Nvidia chips obsolete. If anyone has insight on how these technologies might work together or not, I’d love to hear it.
These all seem like a top –
a.) The boat is getting crowded on the bullish side.
b.) New terms like FOBO are being coined to justify continued bullishness, despite 3 back-to-back well above average years.
Maybe they can keep it going for a while (until Drumpf has to face up to mid-terms), but unless you are nimble, you could be left holding the bag, AI-bust or no AI-bust.
I meant seem to be indications of being toppy*