Nasdaq, S&P500: JP Morgan see a greater chance of a pullback – last week not enough | Forexlive

JP Morgan’s Market Intel team are giving a 40% chance to the US stock market pulling back before resuming its trend higher. Up from their previous 35% probability.

JPM say that last week’s fall does not constitute the pullback they are looking for, but concede they were looking for a bigger pullback in June before indexes rocketed higher.

In June JPM were looking for a deeper pullback citing:

• less rosy macro data
• the continuation of the tightening cycle
• earnings outlook
• and lack of incremental buyers

The analysts say that the first and second of those points above are most similar to now:

• With bottom’s-up earnings estimated higher in the medium term and buyback poised to turn back on, bullets (i) and (ii) would be the key similarities with the addition of positioning