All into Account

In this podcast Joyce Chang, Chair of Global Research is joined by Virginia Martin Heriz, JX Hecker and Paul Xu in J.P. Morgan's ESG Research team to discuss the current landscape dictating the future of ESG, including the political backdrop under Trump 2.0, geopolitical risks, the US-China strategic competition and the rising energy demands from data center expansion to fuel the AI revolution, as forces that are reshaping the supply chain and energy demand. J.P. Morgan Speakers: Mohammed Hossain, Strategic Research  Joyce Chang, Chair of Global Research  Virginia Martin Heriz, Head of ESG Research Methodology and Integration  Paul Xu, Asia Pacific ESG Research  Jean-Xavier Hecker, Head of ESG & Sustainability Research This podcast was recorded on 15 January 2025. This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2025 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

As geopolitical dynamics shift, we explore the potential impacts on oil markets, considering both the immediate risks and the broader implications for global energy stability.

Featured in this podcast is Amy Ho. As the new world order fosters regionalization and new alliances, we explore the implications for globalization, industrial policies, and shifting international trade dynamics. This podcast was recorded on Nov 18, 2024. This communication is provided for information purposes only. Institutional clients please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved.

Demography is destiny and thus a critical consideration for the long-term investor. What are the long-term trends and how will they affect markets? Speakers: Jan Loeys, Long-term Strategy Alexander Wise, Long-term Strategy This podcast was recorded on 9 October 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4800176-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Fabio Bassi joins us to discuss ECB outlook and duration views. Idiosyncratic macro dynamic came to the forefront of rates markets this week with a notable outperformance of EUR rates in a bull steepening move, driven by weak Euro area flash PMI for September and selective inflation data in France and Spain. Higher conviction in the broad disinflation process in the Euro area and downside risk on growth triggered a change in our ECB call, now expecting the ECB to deliver back-to-back 25bp cuts starting in October, reaching 2% policy rate in June 2025, Risks are biased for even lower terminal even in absence of a recession. Speakers: Thomas Salopek, Head of Cross Asset Strategy Fabio Bassi, Head of International Rates Strategy This podcast was recorded on 2 October 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4806192-0, https://www.jpmm.com/research/content/GPS-4802900-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speakers: Thomas Salopek, Global Cross Asset Strategy Rie Nishihara, Head of Japan Equity Strategy Junya Tanase, Chief Japan FX Strategist   This podcast was recorded on Sept 25, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4797455-0 and https://www.jpmm.com/research/content/GPS-4799897-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Daniel and Nelson join us to break down the differences between the European and US High Yield and Leveraged Loan markets, aka comparing apples and oranges. We do a thorough comparison of the asset class universes in terms of ratings and industry composition, and how this has played out in terms of spreads and returns.   Speakers: Thomas Salopek, Global Cross Asset Strategy Daniel Lamy, Head of Europe Credit Strategy Nelson Jantzen, Head of US High Yield and Leveraged Loan Strategy   This podcast was recorded on September 12, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at  https://www.jpmm.com/research/content/GPS-4779883-0  for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Jason Hunter discusses bearish Sep-Oct equity seasonality, critical chart support for the semiconductor group, and the potential that the spring-summer price action marks a large top pattern on the heels of the 2022-2024 bull market. He also highlights the 2s/5s yield curve longer-term base pattern breakout and the prospects for a steepening trend acceleration.   Speakers:  Jason Hunter, Head of Technical Strategy   This podcast was recorded on September 10, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4791254-0 and https://www.jpmm.com/research/content/GPS-4789122-0  for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Featured in this podcast is Rajiv Batra. The Indian Equity Market has remained resilient in the face of volatility in global markets. As such, we discuss how the Indian markets are positioned and what are the opportunities and challenges that lie ahead. This podcast was recorded on Aug 29, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://jpmorganmarkets.com/research/content/GPS-4763283-0, https://jpmorganmarkets.com/research/content/GPS-4760727-0 and https://jpmorganmarkets.com/research/content/GPS-4725824-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved.

Jason Hunter discusses the sharp July trends across fixed income, currency, equity, and commodity markets. While they look more technical and position-driven at the moment, the late-cycle signals coming from cross-market relationships and lower-frequency pattern development suggests the summer shifts can mark the start of something more durable.   Speakers: Jason Hunter, Head of Technical Strategy   This podcast was recorded on 25 July 2024. This communication is provided for information purposes only. Institutional clients can view the related report at  https://www.jpmm.com/research/content/GPS-4742587-0, https://www.jpmm.com/research/content/GPS-4753546-0, https://www.jpmm.com/research/content/GPS-4734633-0, https://www.jpmm.com/research/content/GPS-4745567-0, https://www.jpmm.com/research/content/GPS-4745703-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy SPW, an equal-weighted S&P500 index, has stalled since March, and is behind SPX so far this year by more than 10%. We think this is reflecting a changing Growth-Policy narrative vs early 2024. Entering this year, investor expectations were for a Goldilocks outcome – growth acceleration and at the same time quick Fed easing, starting already in March. The early Fed cuts and the consequent improving credit impulse didn't materialize, which should weigh on growth in 2H. US activity momentum is slowing, with CESI outright negative at present, putting EPS growth projections of as much as 15% acceleration between Q1 and Q4 of this year at risk. Instead of easing preemptively for market-friendly reasons, such as falling inflation, as was the view at the start of the year, the Fed could end up easing, but reactively, in a response to weakening growth. At the same time, there is no safety net any more, the market is positioned long, Vix is at lows, potentially underpricing risks and credit spreads are extremely tight – this is as good as it gets. Adding to the picture strengthening USD and elevated political uncertainty currently, we arrive at a problematic setup for the equity market during summer. In terms of positioning, we have entered this year again OW Growth vs Value style and Large vs Small caps, and we are keeping these for 2H in the US, not expecting much broadening. The recent relative dip due to French political uncertainty is likely to become a buying opportunity as we move through 2H, but we think the risk of further drawdowns is not finished, as the potential new French government will likely try to test the limits of what they can do. This podcast was recorded on 30 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-GPS-4735603-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy After meaningfully lagging the US in 2nd half of last year, Eurozone equities showed some relative stabilization in Q1/Q2, before breaking lower most recently on a spike in French political uncertainty. We have closed the UW on Eurozone vs the US in Q1, driven by the improving Growth - Policy tradeoff in the region, but we believed that it was too early to expect Eurozone to move to an OW vs the US. Now, should one use the current dip to go long? On the positive side, Eurozone CESI is significantly above US one. At the same time, ECB has started easing, while Fed could stay higher for longer, and Eurozone valuations relative to the US are as cheap currently as at the extremes of TMT sell-off, GFC and Euro peripheral crises. Having said that, Eurozone equities are not showing oversold extremes. In fact, on equal weighted basis, Eurozone stocks were trading above US in Q2, and that is still the case, even fully taking into account the French driven weakness. The key will be any improving visibility with respect to the political backdrop. Here, we do not see the current French risks as a game changer for the region. The institutional setup is much more robust than during initial Euro crises. While the snap elections offer increased near term risks, they might be reducing longer term ones, and French government bond spreads to Germany are up 30bp, only higher during 2011 extremes. Now, we do fear that proverbially things might need to “get worse in order to get better”. The chances are that a potential new French government will likely try to test the boundaries of what they can do. Financial markets might end up needing to push back against the more aggressive fiscal easing.  Given this, the risk of further drawdowns will likely not be elevated only between the two rounds of voting and in the immediate aftermath, but also for a while post elections. Overall, we think that, as we move through 2H, there is likely to be a good entry point to buy Eurozone, to go OW vs the US, but for now we stay on the sidelines given the elevated risk of further drawdowns and no capitulation visible. We keep our Defensive sector tilt, and stylewise, we keep OW Growth vs Value stance, believing that it will continue to build on 14% ytd performance in the US and 7% in Europe.   This podcast was recorded on 24 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4728003-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Raphael joins us to provide an overview of the French political developments and their potential impact on the economy. Aditya provides an update of his scenarios for European rates markets and how to position for duration, as we consider whether this situation is idiosyncratic to France or broadening to other Euro sovereign spreads. Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Raphael Brun-Aguerre, European Economist  Aditya Chordia, European Rates Strategist This podcast was recorded on 21 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4730678-0, https://www.jpmm.com/research/content/GPS-4730510-0, https://www.jpmm.com/research/content/GPS-4725293-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved.  

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy In contrast to Q1, when key bond proxy Defensive sectors – Utilities, Real Estate and Staples – were the three worst performers, Q2 has brought a change. QTD, these three sectors are in line in Europe, making a positive swing in performance of 10%. The worst performers so far this quarter are Autos, Travel & Leisure, Chemicals, Luxury and Construction Materials – all Cyclicals. Will this shift last? We believe it will, on further repricing of a range of tail risks, and reiterate our barbell of OW Defensives and Commodities. First, many Cyclical sectors, with some notable exceptions such as Chemicals, Commodities and Logistics, strongly outperformed Defensives last year, when PMIs were falling, so why should they now outperform again? Also, the valuations of Cyclicals, which were cheap at end 2022, have moved to the expensive side of fair value. Second, activity momentum is picking up in manufacturing and in Europe/China, the laggards from last year, but crucially US growth momentum is likely slowing into year-end. As US CESI has turned negative, Defensives could have the upper hand. Finally, bond yields are likely to be flat or move lower into year-end; we reiterate our call from last October that US 10-year yield has likely peaked at 5%. Now, in terms of styles, this should keep helping our OW on Growth vs Value, but should also support bond proxies. Looking at Defensive sectors, Healthcare as an index was up this year in Q1, and in Q2 it worked even ex NOVOB. We think this broadening should continue. Utilities see a pickup in CO2 and in gas prices, in addition to supportive EPS momentum. Staples do not have many fans, but are markedly cheaper currently than in 2022. On the negative side, we remain cautious on Consumer Discretionary – in particular on Autos and on Luxury; we are still UW Chemicals, even as we acknowledge that they already had a terrible 2023, and are again strongly behind ytd, by 1000bp in Europe; and we think that Banks are likely to keep rolling over.   This podcast was recorded on 17 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4724125-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy This podcast was recorded on 09 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4713514-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Looking ahead to next week's BoJ monetary policy meeting, Fujita-san joins us to share her views of what to expect including the timing of QT, the rate hiking trajectory, terminal rates, and the inflation outlook. Yamawaki-san explains what's been driving the move up in JGB yield post NIRP. With regard to the upcoming MPM, we see some upside for yields from here as the market is underpricing rate hikes relative to our view, and demand from Japanese lifers is blunted as they await better yield levels. Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Ayako Fujita, Chief Japan Economist  Takafumi Yamawaki, Chief Japan Rates Strategist This podcast was recorded on 5 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4714146-0, https://www.jpmm.com/research/content/GPS-4711466-0, https://www.jpmm.com/research/content/GPS-4714651-0, for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy Last couple of months are showing softening US growth momentum, but at the same time an increasing potential for higher for longer Fed. We see the market upside capped during summer due to the inconsistency between consensus call for disinflation on one hand, and the belief in no landing and in earnings acceleration on the other. Within the market there was a more Defensive rotation underway in Q2, compared to Q1. We think this will continue on likely peaking in bond yields and more attractive valuations. At sector level, we hold a barbell of Defensives and Commodities, and are in particular cautious on Consumer Cyclicals such as Autos and Travel & Leisure. Stylewise, our OW on Growth vs Value continued working – we are not changing it for now, but Small caps could trade better in 2H. They have again lagged ytd, in all key regions, are cheap, and typically perform better when policy cuts start in Europe. In addition, European activity already had a reset last year, and is likely to be better this year. For the US, the rotation might work also, but we do not see it as clear cut, as Fed could stay higher for longer, and US domestic growth could actually weaken meaningfully in 2H. We reverse our long-term preference for FTSE100 vs FTSE250. This podcast was recorded on 02 June 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4715457-0.pdf  for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Eric and Nelson join us to discuss their views on HG and HY. For HG, we review what's driving the low volatility of credit spreads, whether credit investors becoming more defensive, and what would cause spreads to break out either way. For HY, we highlight our recent forecast revisions, our default rate assumptions, and how recent capital market activity is affecting spreads.   Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Eric Beinstein, Head of US Credit Strategy Nelson Jantzen, Head of US High Yield and Leveraged Loan Strategy   This podcast was recorded on 29 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4713311-0, https://www.jpmm.com/research/content/GPS-4713437-0.pdf, and https://www.jpmm.com/research/content/GPS-4704000-0, for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy In this report, we focus on two topics: first, at sector level on the Cyclicals vs Defensives performance into rate cuts and against the backdrop of falling bond yields, and at the style level on the performance of Large vs Small caps. Historically, Defensives and bond proxies struggled when bond yields would be moving higher. This phase might be ending. Especially if bond yields are falling as economic growth is moderating, the sector leadership is likely to be more Defensively tilted, as is the case so far in Q2. Additional considerations are: valuations – Cyclicals are generally trading stretched vs Defensives; past performance – the Cyclical run over the last 18 months has opened up a gap with PMIs, which has not closed yet; and finally the weaker recent earnings delivery of Cyclical vs Defensive sectors. We favour a barbell of Defensives and Commodities. With respect to Small vs Large caps style tilts, there is a typical pattern of weakness in Small caps into, and a rebound post, the start of central banks easing. This is visible for both the Eurozone and UK small caps. For the US Small vs Large caps, the weakness into the first Fed cut is seen too, but there was no imminent rebound, more a weaker performance for another six months or so, and only then a recovery. Additional consideration for small caps trade is likely the domestic economic backdrop. Here, European growth had a reset last year, and is looking sequentially better this year, while US was resilient last year, but could soften from here. Small caps have had two poor years everywhere, and are lagging again so far ytd, by 9% in the US, 4% in Eurozone, 2% in UK and 8% in Japan – the turn might be upon us, likely more in Europe than in the US, though, given less visibility over Fed start and softer forward activity momentum in the US. This podcast was recorded on 27 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4117650-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

Speaker - Mislav Matejka, CFA, Head of Global Equity Strategy Q1 reporting season again showed an age-old pattern of beats vs heavily lowered expectations. For full year 2024, earnings projections in the US are unchanged ytd, and down a few percent in Europe. The downgrades to sellside analyst EPS expectations throughout the year are nothing unusual, they happen most of the time, without adverse equity market reaction, but we believe that it is important that they do not escalate, as then the market might not be able to look through them. Beneath the surface, there are three interesting trends, one being maintained, and two showing a rotation: 1. All the US earnings growth is still Mag-7 driven. Q1 was the 5th quarter in a row where, if Mag-7 contribution is taken out, the remaining 493 S&P500 constituents have shown outright negative yoy% EPS growth. This has been beneficial to our continued OW on Growth vs Value style, and OW large vs small caps, but the odds could be increasing that we might see some reversal. 2. European earnings are starting to do better vs the US, and that was one of the reasons why we upgraded Eurozone vs the US last quarter. We continue to believe that the region will at least hold its own vs the US, irrespective of the direction of the overall equity market. 3. Cyclical sector earnings are softening vs Defensives. For S&P500, median Cyclical EPS growth is now below Defensives, for the first time since Covid. This is one of the reasons why we argued in early April for a rotation into Defensives, especially into the Utilities and Real Estate sectors. From a top down perspective, we are particularly concerned about the earnings prospects of the Autos sector, rating it as UW. This podcast was recorded on 19 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4117650-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy After a terrible spell between Jan '23 and January of this year, where MSCI China lost almost 40%, it is now up 25% from the lows. While we do not believe that the longer term structural concerns of deflationary backdrop, real estate demand-supply imbalances, credit saturation and global decoupling are finished, our tactical view remains that the more positive China trading could last through summer, through July-August, until the US elections heat up in earnest. There is still an EM investor underweight on China, and the valuations probably have another 10-15% upside before closing the discount to historical. A more bullish tactical China stance was one of the drivers of our upgrade of Eurozone equities in Q1. We continue to believe that Eurozone risk-reward has improved, and that the region will at least hold its own vs the US, whether the overall market goes up or down. UK (OW) is also starting to trade better of late, erasing the almost 10% relative weakness seen earlier in the year. At sector level, we think commodities remain interesting as a way to position for more positive China trading, both Mining and Energy. We are less positive on some of other traditional China plays, such as Autos (UW) and Luxury (N). Pricing is a significant risk for both, as well as a potential volume disappointment, leaving their elevated margins at risk. More broadly, at sector level we have been arguing that Defensives should start to trade better, last month Real Estate, Utilities, Staples and Healthcare are top 4 sectors in Europe. Now, more positive tactical China call is clearly a big help for EM group, but we do not believe EM is a buy vs DM. The headwinds for EM remain Fed higher for longer, and stronger USD. EM equities typically struggle to outperform DM when their currencies are under pressure. This podcast was recorded on 12 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4696703-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

It's been a tough year for both getting long outright duration or being long steepeners. We expect disinflation will reassert itself, but in the near term, there is event risk (e.g., CPI & HICP numbers) making us cautious. Fabio joins us to discuss the catalysts to trade duration, the curve, and intra-EMU spreads.   Speakers Thomas Salopek, Global Cross Asset Strategy Fabio Bassi, Head of International Rates Strategy   This podcast was recorded on May 8, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at  https://www.jpmm.com/research/content/GPS-4691318-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speakers:   Joyce Chang, Chair of Global Research Jan Loeys, Long-term Strategy Joe Lupton, Economic and Policy Research Natasha Kaneva, Global Commodities Research Steve Dulake, Global Head of Credit, Securitized Products and Public Finance Research     This podcast was recorded on 7 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4682573-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy We are concerned about inflation staying too high if there is no slack created in the economy, adverse bonds demand-supply with negative term premia, consensus expectation of profit acceleration of almost 20% between Q1 and Q4 of this year, which doesn't typically happen, especially if the economy softens in 2H, consumer tailwinds potentially turning, as well as concentration and leadership reversal hurting the market. At the core, the Goldilocks view that market embraced in Q1 of inflation/rates moving lower but at the same time of earnings acceleration and economy having no landing remains an inconsistent one. In fact, the Growth-Inflation tradeoff could end up the opposite, as seen in recent ISM showing a spike in pricing and slowing orders. Together with seasonally poor time for markets coming up and still stretched positioning, we look for more of a consolidation in equity markets over the next months. Within this, we advocate for some of the rotations to come up/have legs. Growth is ahead of Value ytd, small caps are heavily behind again ytd. We fundamentally stay with Growth, Quality and large caps tilts, but the turn could be coming, where small caps tended to perform better as ECB starts to ease. Regionally, we have in Q1 taken profits on US vs Eurozone OW, as well as tactically exited our longstanding China bearish stance. The latest market move to a more Defensive trading should have legs, such as recent outperformance of Utilities and Staples, alongside commodity sectors. This podcast was recorded on 06 May 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4691410-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Global Head of Equity Strategy At the overall market level, we remain concerned about the repeat of last summer's drawdown, inflation staying too hot is a real possibility, market will not like it if bond yields move above 5%. Within this, we have made some regional changes in Q1, specifically we tactically closed our longstanding China bearish view, given 30%+ drawdown in the past 12 months. Also, we have upgraded Eurozone equities last quarter. To be clear, we don't expect Eurozone to directionally decouple from the US, but it is interesting that in the recent bout of market weakness, S&P500 was down 5-6%, in contrast to EuroStoxx50 down only 3%. We continue to see an improved relative risk-reward for Eurozone equities: 1. Eurozone is trading at 13x forward P/E, vs S&P500 at 20x. In terms of shareholder returns, buybacks yield in Eurozone has moved closer to the US, while dividend yields are remaining double the US. 2. In what is historically atypical, ECB is set to start cutting ahead of the Fed, and by a greater magnitude. At the same time, PMI momentum is improving in Eurozone vs the US, post last year's reset. 3. Tactically better China performance will help Eurozone vs the US trade, and also UK (OW) and commodities. 4. We have held preference for Growth over Value, for High vs low Quality and for large vs small cap stocks, and we still believe that fundamentally these are right exposures, but do recognize the potential for reversal is very high. Now, the risk of extreme concentration and the momentum unwind is also present in Europe, but it is on a much bigger scale in the US. In the report we address the market, sectors, styles etc. behavior around the first ECB cut in the cycle, which is likely coming up in June. Notably, small caps begin to perform better post the start of ECB cuts. This podcast was recorded on 28 April 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4683726-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

Speakers:     Thomas Salopek, Head of Global Cross Asset Strategy   Ipek Ozil, US Interest Rate Derivatives Strategist   Powell's recent comments represent a strong reversal from the dovishness from March, so policy uncertainty remains as elevated as ever. In response to strong CPI data this week, the options markets are implying a significant weight on a hike by year-end, leaving rate-cut scenarios with a total weight similar to rate hike scenarios.   This podcast was recorded on 17 April 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4669694-0, and  https://www.jpmm.com/research/content/GPS-4672843-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.      

Speaker: Mislav, Matejka, CFA, Head of Global Equity Strategy Q1 reporting season is upon us. As is typical, consensus projections have been moving materially lower over the past months. For S&P500, IBES is now calling for 3% yoy EPS growth, which is down from 10-12% projections seen last summer. In a break from recent norms, though, the activity momentum firmed up during the quarter, as seen in rising global PMIs. These together suggest that we will get earnings beats. The likely earnings beats do not necessarily mean that equities will advance during the reporting season, though. This is because the market has already strongly rerated during Q1, and the big gap has opened up ytd between Fed projections and equity index levels. The risks of interest rates spiking for the “wrong reasons”, Fed pivot getting fully reversed and inflation staying too hot are all elevated. At the same time, geopolitical uncertainty could quickly spike further, and any de-escalation prove fleeting. In addition, consensus expectations are for a very steep climb in earnings over the next few quarters, from Q1 S&P500 projection of 55$ to Q4 forecast of 65$, amounting to an almost 20% increase. This is at a risk of disappointment. In terms of earnings themes, pricing is likely to soften, with topline growth coming back to earth. At sector level, the pickup in commodity prices could help the respective sectors performance. We recently advised for Utilities to perform better, irrespective of bond yields move, and believe that Banks earnings results could end up underwhelming. Regionally, we believe that the period of US earnings outperformance vs Eurozone might be ending. The relative US-Eurozone PMI momentum is likely peaking, which suggests relative EPS delivery might be turning too. These support our recent upgrade of Eurozone equities vs the US. This podcast was recorded on 14 April 2023. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4671662-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

A hot CPI print following the recent strong jobs print has put ‘high for long' back in focus, challenging the soft landing narrative. We discuss with Phoebe what these ‘bumps in the road' mean our views on TIPS, breakevens, and duration generally. As for Gold, Greg dissects the reasons for the recent rally and reviews whether the rate cutting cycle is going to be as bullish for Gold as it was historically.   Speakers: Thomas Salopek, Global Cross Asset Strategy Phoebe White, Head of US Inflation Strategy Greg Shearer, Head of Metals Research This podcast was recorded on 11 April 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4671684-0, https://www.jpmm.com/research/content/GPS-4667440-0, for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy With respect to bond yields' direction, our call last October was to go long duration, that bond yields have likely peaked. After the ytd bounceback, we think that yields will resume moving lower. Our FI team forecasts that US and German 10-year yields will be below current on 3-, 6- and 9-month horizons. We fundamentally agree with this, especially given the elevated geopolitical risks at present, but note the risks of inflation staying too hot. The Fed might be wrong to assume that all the recent inflation pickup is transitory; also the term premia are outright negative again – pointing to inflation complacency. If bond yields end up moving higher from here, against our base case view, that might be “for the wrong reasons”, with market weakening in that scenario, like last summer. Now, irrespective of how one sees the bond yields' direction from here, we think that the Utilities sector's poor performance has likely gone too far. If yields fall, as is our core view, that should help the sector. In the opposite scenario, the overall market could weaken, and the typical low beta of Utilities could come to the fore. In addition: 1. The client concern is with respect to perceived elevated leverage of the sector, but we think this is misplaced. Leverage is higher than in the past, but cash flow generation is strong and Utilities stocks are solidly investment grade. 2. Utilities have been derated to pre-Ukraine levels, but power prices are still higher than pre-Ukraine. Power prices should not go lower from here, as industrial demand is starting to come back. 3. Earnings relative of Utilities are continuing to move up, making the sector very attractive at present. P/E relative of Utilities is near record cheap. 4. Renewables have been underperforming the rest of the sector for more than three years now, and are increasingly more attractively priced. We also think that Real Estate should be looked at again. This podcast was recorded on 07 April 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4650376-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy In terms of leadership, US and Japan are ahead of other markets ytd, Growth is outperforming Value and large caps are again beating small, in all key regions. We continue to believe that this style of leadership will broadly stay the case for a while longer, until there is a break, or a reset, in the cycle. For Value, commodities, low Quality, small caps, EM or International stocks to begin leading more sustainably one needs to see a reflationary backdrop, in our view, but we could have the opposite. Within this, we have recently taken profits on US vs Eurozone OW, as the Eurozone risk-reward has improved, in our view. Among other, Eurozone valuations appear very attractive, relative growth momentum could be bottoming out and ECB could start moving ahead of the Fed, which would be very atypical. We also have a tactical buy on China given extreme cheapness and UW positioning by most investors. Broadly, JPM Fixed Income's call is that bond yields are fundamentally set to move lower in 2H, but we note a pickup in inflation swaps, as well as the outright negative term premia for bonds again, which suggests that there is a lot of complacency in the bond market with respect to the inflation risk. Consequently, the gap that has opened up ytd between Fed futures and the equity market is getting wider. Equities rallied almost 30% from last October lows, driven in Nov-Dec by the expectation of a Fed pivot, but these projections have fully reversed back to October low levels. Equities are ignoring the most recent pivot of a pivot, which might be a mistake. The assumption that the market is likely making here is one of growth acceleration coming to the rescue in 2H. In this regard, we note that earnings projections for 2024 are still not moving up. Regionally, Japan is staying our top pick, continuing our 2023 preference. This podcast was recorded on 31 March 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4662999-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Using positioning as a guide, investors have been expressing the opinion that Mortgages are cheap relative to Corporates, but the excess returns have gone the other way, with Corporates outperforming by ~1% in terms of excess return YTD. Looking ahead, Corporates can still outperform MBS in a range-bound rate environment with little economic growth risk while high-coupon MBS, with better yields due to negative convexity, can also do well in a stable rate environment. Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Nathaniel Rosenbaum, HG Credit Strategist  Nicholas Maciunas, Head of Agency MBS Research This podcast was recorded on April 1, 2024.  This communication is provided for information purposes only. Institutional clients can view the related reports at https://www.jpmm.com/research/content/GPS-4656379-0 and https://www.jpmm.com/research/content/GPS-4658455-0. For more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved.

Thomas Salopek speaks with Rie Nishihara, Head of Japan Equity Strategist, Takafumi Yamawaki, Head of Japan Fixed Income Research, and Ikue Saito, Currency Strategist. Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Rie Nishihara, Head of Japan Equity Strategist Takafumi Yamawaki, Head of Japan Fixed Income Research Ikue Saito, Currency Strategist This podcast was recorded on March 25, 2024. This communication is provided for information purposes only. Institutional clients can view the related reports at: https://www.jpmm.com/research/content/GPS-4657063-0 https://www.jpmm.com/research/content/GPS-4655242-0 https://www.jpmm.com/research/content/GPS-4655120-0 https://www.jpmm.com/research/content/GPS-4658455-0 For more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy The bulk of the equity performance so far this year, and indeed in the past 18 months, was driven by multiple expansion. Globally, 12m forward earnings are up only 7% from the lows, in contrast to nearly 30% P/E upmove. 2024 EPS projections are again down small in the US ytd, and are more meaningfully lower in Europe. At the same time, bond yields are higher, squeezing ERPs. Global earnings yield vs bond yield differential has been moving lower, to be now below 2007 levels. Central banks are set to deliver some cuts in 2H, but in order to justify current equity valuations, we believe that we will need to see at least some earnings acceleration, as well. Ultimately, equity valuations will end up responding to earnings momentum trends, as there is a clear historical correlation between P/E multiples and earnings revisions. IBES is projecting a sequential pickup in earnings growth between 2023 and 2026, but our concern is that profit growth could underwhelm. If the earnings acceleration fails to materialize, this could act as a constraint, in particular for Cyclical sectors, which are currently trading at price and P/E relative highs vs Defensives. Regionally, China equities showed no rerating over the past 18 months, still trading around 9x forward, which is at absolute and relative lows. Eurozone trailing buybacks yield is at present quite close to US. At the same time, Eurozone dividend yield at 3.0% is much higher than US at 1.3%, and bond yields are meaningfully lower – with these three together resulting in a much better total equity yield vs bond yield for Eurozone equities than for the US, of 240bp – we closed US vs Eurozone OW last week.   This podcast was recorded on 25 March 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4651219-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

In this podcast Joyce Chang, Chair of Global Research is joined by Sam Saperstein, Head of Women on The Move across the entire JPMorgan Chase platform to discuss the work J.P. Morgan Chase is doing on expanding women-owned businesses, bridging the funding gap for women founders and how we are promoting women and girls' financial health. Speakers Joyce Chang, Chair of Global Research Samantha Saperstein, Managing Director and Global Head of Women on the Move, JPMorgan Chase Co   Please see our annual J.P. Morgan Perspectives: Global state of gender balance in 2024: Post-pandemic gains, but far from parity report, where we explore the progress towards achieving gender balance and assess the challenges facing women in 2024.   This was recorded on March 20, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4645664-0  for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.   

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy We have cut Eurozone to UW vs the US in early May of 2023, and had a preference for the US since. We are now closing the US over Eurozone OW, for the following reasons: 1. Eurozone has lagged in the past few quarters, losing 14% relative since May, and had relative outflows - in 41 out of the past 52 wks. At 13.3x forward, it is trading cheap vs the US, which is now on 21x. Even if one were to look at sector neutral P/E rating of Eurozone vs the US, it is trading the cheapest vs any time pre COVID. 2. We had a preference for Growth over Value style through 2023 and again this year. Even as we stay with this tilt, we note that Growth style has already performed exceptionally well, it is trading stretched and is at risk of a reversal. Of course, within Europe there is also an increasing risk of MOMO unwind, but the magnitude of the potential impact would always be greater for the US market. 3. In terms of activity momentum, Eurozone had a clear weakening through last year and especially relative to the US. The relative growth disappointments of the region might have peaked, as seen in improving relative CESIs. 4. While ECB typically takes its cue from the Fed, there is a chance that it moves ahead of the US this time around. 5. We have been cautious on China over the past year from a global allocation perspective, but have a tactically more positive China call, and if this continues tracking, it could indirectly help Eurozone. We are neutralizing the US vs Eurozone preference, but not reversing. This is because the potential for a market drawdown is elevated, with Goldilocks fully in the price. The risks are on both sides of this narrow path: either to growth disappointing, as seen in latest weak retail sales and US small business confidence, and also from inflation potentially staying too hot, as seen in the US 1-year inflation swaps approaching October highs. What is attractive in Euro Area? We note that every single Eurozone level 1 sector is trading at a greater than historical discount vs the US.   This podcast was recorded on 17 March 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4651487-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

A slightly warmish CPI hasn't moved the needle for us, so we stick with our current view on duration. Despite recently turning neutral on US duration, slowing growth and inflation should produce DM gov't bond return of ~6.5% assuming our yield targets are realized. Upside risk for growth and inflation may continue to eat in to rate cutting plans. With the Magnificent 7 facing jitters and Equal Weight S&P at highs, we are skeptical of the breadth improvement as megacaps are still leading with the laggards dragged along for the ride. As for PMI dislocations vs risk assets, we acknowledge the improvement on the growth trajectory closing some of the gap, but historically, in the event of a 2 standard deviation gap, stocks have had to make more of the adjustment.   Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Jason Hunter, Head of Technical Strategy   This podcast was recorded on 12 March 2024.  This communication is provided for information purposes only. Institutional clients can view the related reports at https://www.jpmm.com/research/content/GPS-4642559-0 and https://www.jpmm.com/research/content/GPS-4647814-0. For more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved  

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy We favoured Growth over Value style through last year, and again so far ytd, arguing that the Nov-Dec Value rally – such as an outperformance of BKX and of small caps seen at the time – was unlikely to last. There is a clear concern over how sustainable the Mag -7 run is, but we note that this group of stocks is not trading increasingly more expensive, at least not in relative terms. In fact, Mag-7 stocks appear cheaper at present vs the rest of the market than they were trading on average in the past five years. Admittedly, in absolute terms, there appears to be an excess, and Mag-7 could see earnings disappointments as well, proving to be more cyclical. More broadly, Growth style is also supported by the continued better earnings delivery vs Value, and this is the reason we keep the Growth style preference. Where valuations are becoming stretched is in Cyclical sector groups, with European Cyclicals trading at more than one standard deviation expensive vs Defensives. Cyclicals in general are at price relative highs vs Defensives, as high as in '09-'10, when the synchronized global recovery did materialize. Such an acceleration might be the wrong template this time around. The link between Cyclicals/Defensives earnings and indicators such as IFO remains strong, with IFO leading, and it suggests that Cyclicals earnings are set to soften over the next few quarters, in contrast to the consensus calling for an acceleration. In addition, bond yields are set to inflect lower again, we called in March Chartbook last week for a return to the long duration trade, and this could take out some relative support from Cyclicals. This podcast was recorded on 10 March 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4644737-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA - Head of Global Equity Strategy So far ytd, US and Japan are ahead of other markets, Growth is outperforming Value and large caps are again beating small in all key regions. We continue to believe that this, ultimately unhealthy, high concentration and narrow leadership is set to stay for a while longer. To buy Value and International stocks one needs to see a reflationary backdrop, in our view, but we could have the opposite. In terms of bond yields, we argued last October to go long duration, but also in January to look for a tactical bounce back in bond yields, as Fed easing became overdiscounted in markets. We now think that the counter-rally in yields might be running out of steam, and would advocate to go long duration again. The move back higher in Fed futures might be getting done – they roundtripped back to October levels, and activity momentum could soften from here. The question is, why didn't equities weaken as US 10-year yields backed up 50bp during Jan-Feb? We think that this is because investors assumed that the yield upmove is reflective of economic acceleration, but we note that earnings projections for 2024 are not reacting positively – they keep coming down in most sectors. If the growth acceleration does not come through, this could act as a headwind. Overall, we keep OW Growth vs Value, US vs Europe, and still see Japan as top regional pick – we look for these to continue tracking.   This podcast was recorded on 04 March 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4642382-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA - Head of Global Equity Strategy Bulls are to a good extent basing their constructive market call on the premise that corporate profits are set to accelerate, supported by the bottoming out in activity indicators that is now in progress. However, the earnings reality might turn out to be the opposite as we move through the year. In aggregate, corporate profit margins are elevated in a historical context, and appear to be peaking out. The historical pattern where profit margins always start to move lower ahead of the next economic downturn is clear. We see three sources of downside to profit margins from here: 1) Many corporates benefitted from the unique feature of this cycle: as interest rates increased 300bp+, the net interest expense came down. That could be explained by companies locking in low cost of financing through extending the duration of their debt, and also through many corporates seeing an improving return on their cash balances. This development is set to normalize. Separately, the basket of stocks with high refinancing needs is losing 20% vs SXXP over a year ago - JPDEHFCL, and our basket of cash rich companies is ahead by 14% - JPDEHFCW. We think this outperformance will continue through 1H. 2) Topline was exceptionally strong post COVID for many corporates, and pricing power was high. As nominal GDP growth rates fade, margins could weaken. 3) If the economy slows, partly because the supports that it enjoyed last year do not repeat, such as fiscal stimulus, ULCs could pick up. Profit margin proxy, corporate deflator minus ULCs, could turn into more of a headwind. Putting the above three together, one might end up with a disappointing profits outcome even without seeing an outright recession, and we note that 2024 EPS projections keep coming down in key regions. It is interesting to note that for S&P500 all the profit growth in the past few quarters was due to Magnificent 7, and this is one of the reasons why we remain OW Growth vs Value.  Ex these stocks, EPS growth for the remaining S&P500 constituents is outright negative.   This podcast was recorded on 26 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4633138-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Yields have move up sharply since the mid-January trough on the back of strong growth and inflation data, although we feel the market may have gone too far, providing an entry point to get long duration, especially now that positioning has neutralized.  Jay and Jason join today to discuss the fundamental and technical picture for US Fixed Income. Speakers: Thomas Salopek, Global Cross Asset Strategy Jay Barry, Co-Head of US Rates Strategy Jason Hunter, Head of Technical Strategy This podcast was recorded on 22 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4625977-0, https://www.jpmm.com/research/content/GPS-4630257-0, https://www.jpmm.com/research/content/GPS-4624689-0, for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy One of the sector calls where we face the most pushback from investors is our UW on Banks, entered in Q4. Until Q4, Banks had outperformed for three years in a row, driven by better EPS momentum and ultimately by rising bond yields. We have downgraded the sector as we think this phase is over. US 10-year moved from 0.5% in 2020 to 5% last October, the point at which we argued that bond yields have likely peaked. This is even as we tactically think that short-term bond yields are likely to consolidate, and be somewhat higher. Central banks will be cutting rates this year, which will directly reduce the earnings power of the sector. Second, the pressure could arise from the peaking out in relative EPS growth of the sector. The stalling in Banks' relative EPS momentum could be enough for the sector to stop working. We note that the EPS revisions of European Banks have just recently entered negative territory.  In addition, the net interest income for Banks could weaken, from elevated levels, and deposit betas could increase. Banks meaningfully increased capital return to shareholders, but this could be as good as it gets. Finally, Banks are still a high-beta play on economic momentum and on credit spreads, where the current, rather optimistic, outlook that is priced in the markets might not last. Notably, the commercial real estate remains an overhang for the sector. Regionally, our top pick is Japan, and we still like Japanese Banks vs US and European ones, a call started last April. The Japanese rates cycle remains disconnected from the US and Europe, and it could be moving in the opposite direction this year. Big picture, we keep our view of OW Growth vs Value and preference for US vs International, in effect fading the Nov-Dec market broadening rally. So far ytd, US, Growth and large caps are strongly outperforming International, Value and small caps,  in all regions, and our UW on Banks fits this dynamic. This podcast was recorded on 18 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4622395-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA - Head of Global Equity Strategy From a global equity perspective, we had upgraded Japan to OW in Dec '22. While we still think that USD is likely to be stronger from here, it might not be crucial to hedge JPY anymore, as the interest rate differential between the US and Japan looks set to start converging this year. For the continued bullish view on Japan, we reiterate: First, TSE reform is set to lead to improved corporate profitability and greater shareholder returns, given that more than half of Japanese stocks are still trading net cash, and 40% are trading below tangible book. Second, even though it feels as though Japan is a consensus overweight, we think that flows are still at an early stage. Foreigners bought 5trn Yen of Japanese stocks in 2023, which compares to 35trn Yen during the Koizumi era and 25trn Yen during Abenomics, the last two times when Japanese stocks moved up more than 100%. Third, there is a case to be made for some reflation in Japan, through house price appreciation and positive wage growth for Japanese consumers, and lastly, Japan is the only large DM market with dividend yield above bond yield, vs historical. In a European context, after outperforming strongly in 2022, the only large DM market up in that year, the UK lagged significantly in 2023. This has left UK at record cheap, even ex US. UK has the highest dividend yield out of all markets, at 4.3% yield, vs 2.0% for MSCI World. With the central bank cutting cycle about to commence, dividend strategies might come into the spotlight. The UK is a commodity-heavy market, and both Materials and Energy lagged last year, dragging the index down. If commodities find a floor, especially as the FCF yields of both Mining and Energy are very high at present, this could help. China outlook could play a role, too. We held a cautious fundamental view on the China market for a while, but recognize that it is heavily underowned and cheap post the big selloff: MSCI China lost 30% in a year. If China sees short squeezes, that could indirectly benefit the UK.   This podcast was recorded on 12 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4622327-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA So far this year, US is ahead of International, Growth is outperforming Value, large caps are again beating small - Russell2000 is outright down on the year 3%, and China continued struggling. We believe that this, ultimately unhealthy, high concentration and narrow leadership is set to continue until something breaks. To buy Value, beta and International stocks, one needs to see a reflationary backdrop, in our view, but we could have the exact opposite. The risk is of a disappointment on both sides of the Goldilocks narrative. Fed cuts might still be overdiscounted, despite the recent hawkish repricing, and the chances are that inflation picks up again, supply side driven, rather than due to stronger activity, freight rates have nearly tripled. We believe our long duration call made in October will have legs in 2024, but have argued at the start of this year that yields will likely consolidate near term, and the USD could be bottoming out. Regionally, we have preferred US to International stocks since May of last year, and don't see that changing yet. We remain cautious on China, keep fading the bounces, and keep OW Japan – it remains our top regional pick. We are OW Growth vs Value, continuing our call from 2023, and reiterate our downgrade of Banks to UW in Q4 of last year, after three years of Banks beating the market. This podcast was recorded on 04 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4619832-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2023 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Jason Hunter discusses the short-term technical setups or US Treasuries and equities following the Jan FOMC meeting. He also highlights the key resistance on Shanghai Composite, after the failed bounce leaves that market in a bear trend and vulnerable to further downside. Speakers: Jason Hunter, Head of Technical Strategy This podcast was recorded on 1 February 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4612852-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

We've seen a three-month period of underperformance for Chinese stocks and outperformance for Japanese stocks. Our positioning indicators based on futures and cross-border flows hint at flows from China to Japan. The recent China stimulus points to better days ahead for Chinese equities, and the worry was money flowing back from Japan would blunt the Japanese equity rally. Overall, we downplay the idea that a recovery for Chinese stocks must come at Japan's expense.   Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Wendy Liu, Chief Asia and China Equity Strategist Rie Nishihara, Chief Japan Equity Strategist   This podcast was recorded on Jan. 30, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4613215-0, https://www.jpmm.com/research/content/GPS-4609156-0, and https://www.jpmm.com/research/content/GPS-4614086-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

Speaker: Mislav Matejka, CFA - Head of Global Equity Strategy The last positive spell for Eurozone was between Sept '22 and May '23, when it outperformed S&P500 by as much as 32%, in USD terms. We cut Eurozone to UW in early May of last year, and the question is what can help Eurozone to deliver another leg of outperformance. It certainly screens cheap vs the US, at a 15% greater discount than typical on a sector-neutral P/E metric, and is likely underowned, as seen in 40 weeks of outflows over the last year. A more constructive China backdrop would definitely be a help for Eurozone to take the lead. As MSCI China is down as much as 30% vs a year ago and is likely a fully consensus UW everywhere, the current short squeeze could continue for a bit longer. Having said that, from a fundamental standpoint, we remain bearish on the region, for now. Another factor is the style leadership. We stay OW Growth vs Value, a position we held through 2023. As long as the market stays narrow, Tech driven, the US is likely to have the upper hand vs Eurozone. We note that EPS revisions in Europe remain worse than in the US. Finally, USD direction matters. The Q4 USD downmove might be finishing as the Fed cuts might have been overdiscounted in the near term. If USD is bottoming out, it would be hard for Eurozone to work. Backtested, Eurozone was actually the worst-performing region in times of USD strength, and Japan was the best international market – Japan remains our key regional OW for 2024. What to buy/sell in Europe? From the negative side, we highlight: we are still UW Chemicals and UW Autos, as of Q4 UW Hotels and Airlines, and have in November turned bearish on Banks. On the buy side, we have OW Utilities, upgraded Healthcare in November. We double upgraded Real Estate to OW last October, and finally, we are still bullish Aerospace & Defense.   This podcast was recorded on 29 January 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4609199-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speakers:   Thomas Salopek, Global Cross Asset Strategy   Pedro Martins, Chief EM Equity strategist   David Aserkoff, Head of CEEMEA Equity Strategy     This podcast was recorded on January 25, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4609169-0, https://www.jpmm.com/research/content/GPS-4602980-0,  https://www.jpmm.com/research/content/GPS-4605609-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.  

HG bond spreads at 110bp are just 2bp wide to the post-GFC tightest level, so Eric joins to shed some light on why spreads are so tight. While our views haven't materially changed, the market moves have put us well though our YE spread forecast of 125bp, so we consider which catalysts can trigger widening. A disappointing earnings season may prove to be the near-term test for HG, which we see as priced to perfection.   Speakers: Thomas Salopek, Head of Global Cross Asset Strategy Eric Beinstein, Head of US Credit Strategy   This podcast was recorded on January 22, 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4602424-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2023 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.    

Speaker: Mislav Matejka, CFA - Head of Global Equity Strategy   For Q4 results, the activity momentum has generally decelerated in the quarter, which calls for a sequential weakness in earnings delivery. The good news is that the hurdle rate has come down aggressively, for S&P500 from 10% to only 2% yoy. Given this, the actual results are likely to yet again beat the much lowered estimates. The problem is that the market really needs some net earnings upgrades to advance from current levels, not just the beats vs heavily lowered projections, in our view. This is because the sentiment and positioning is stretched, valuation multiples have rerated, and the key driver of the Q4 rally, the move lower in bond yields, is likely over for the time being. Big picture, 2024 EPS projections keep coming down, in most regions. This is unlikely to change, we see risks to both pricing and to volumes for this year, in addition to what is generally a tough hurdle rate for most corporates - profit margins are elevated vs typical. At subsector level, Semis, Autos and Banks margins are at record highs, and could weaken. Chemicals margins are subdued, but we fear they could stay weak - we keep our long held UW view on the Chemicals sector. In aggregate, COVID distortions appear to have benefited Cyclicals more than the Defensives, and this is where the unwind could happen. We stay OW Growth vs Value, continuing last year's style preference, keep OW US vs Eurozone, and believe that Defensives are set to perform better this year.   This podcast was recorded on 21 January 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4604423-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2023 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Speaker: Mislav Matejka, CFA, Head of Global Equity Strategy The question is whether the move lower in bond yields is over for the time being, and can it resume further down the line without a clear bout of activity weakness materializing? We called last October to position for the rollover in bond yields, but post the sharp fall of 100bp in 3 months, a pause is likely. Central banks rate projections have already moved substantially, now pricing in a cumulative 150-170bp of cuts by the Fed and ECB over the next 12 months, and markets digested a raft of benign inflation prints. Big picture, we believe that the long duration call will stay relevant for 2024, but the near-term stabilization could happen due to the exhaustion in negative convexity impact, on potentially more longer-dated government bond issuance, and along with likely some more mixed inflation prints ahead. We are unlikely to see another leg lower in bond yields near term unless or until there is a clear deterioration in activity dataflow. Now, what could be the implications of this for equity markets? In November and December equities took the fall in bond yields as an overwhelming positive, fueling a risk-on market rebound. Cyclicals outperformed Defensives, with the exception of Real Estate and Utilities; however, the typical defensive bond proxies significantly lagged. If yields stall near term, this likely stalls the rally too, and crucially we do not expect that the decidedly one-sided interpretation of why bond yields have fallen will continue. This is especially if we do see some weakening in consumer dataflow, which was solid to date – most recently US ISM services employment component fell sharply. If the consumer setup changes, then Defensive names could have a catchup, especially as their valuations vs Cyclicals are now attractive, and as Cyclicals have moved further away from activity dataflow. We note that Healthcare, Telecoms and Staples have started the year on a stronger note in both the US and in Europe, and we expect this to continue. This podcast was recorded on 14 January 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4600086-0 for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.

Jason Hunter discusses some of the more interesting technical setups and signals from his recent publications and ahead of tomorrow's CPI report. This podcast was recorded on 10 January 2024. This communication is provided for information purposes only. Institutional clients can view the related report at https://www.jpmm.com/research/content/GPS-4588098-0, https://www.jpmm.com/research/content/GPS-4596708-0, https://www.jpmm.com/research/content/GPS-4594796-0, https://www.jpmm.com/research/content/GPS-4596573-0, for more information; please visit www.jpmm.com/research/disclosures for important disclosures. © 2024 JPMorgan Chase & Co. All rights reserved. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. It is strictly prohibited to use or share without prior written consent from J.P. Morgan any research material received from J.P. Morgan or an authorized third-party (“J.P. Morgan Data”) in any third-party artificial intelligence (“AI”) systems or models when such J.P. Morgan Data is accessible by a third-party. It is permissible to use J.P. Morgan Data for internal business purposes only in an AI system or model that protects the confidentiality of J.P. Morgan Data so as to prevent any and all access to or use of such J.P. Morgan Data by any third-party.