JPMorgan recommends defensive stance on stocks

JPMorgan Chase & Co. Strategist Marko Kolanovic advised stock investors to remain defensive due to the uncertainty in the economic outlook. JPMorgan Chase & Co. Strategist Marko Kolanovic said that developments in the banking sector have increased uncertainty, and therefore investors should remain defensive in stocks. Sharing a note with clients on Monday, Kolanovic predicted that downward revisions that could be made to economic growth estimates in the coming months could further deteriorate market perceptions. Stating that technology sector stocks are expected to be positively affected by low bond yields, Kolanovic said that US and European stocks would be more advantageous for this reason. Morgan Stanley's strategists led by Michael Wilson assessed that bond markets, which priced in interest rate cuts from the Fed after May, no longer believe in central bank guidance, that this situation increases volatility, and that profitability expectations in stocks do not reflect the real situation. However, despite bank failures and recession concerns, the S&P 500 index in the US continues to advance to the critical 4,000 level. The index tested above this level for the third time in the last four trading days yesterday and has closed above this level four times since the end of February. However, Tony Pasquariello, head of hedge funds at Goldman Sachs Group Inc., believes that movements above 4,000 will not last long.