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JPMorgan Trading Desk Turns Tactically Cautious, Urges Cutting Net Long Exposure
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News EditorBlockBeats reports that JPMorgan's trading desk, on Sept. 1, shifted its short-term view to "tactically cautious," expecting markets to get "bumpier" over the next two to three weeks. The desk said a "sharp pullback" at the index level is not necessarily in store, but "more turbulence" may emerge in sectors and individual stocks. On risk sources, it highlighted Federal Reserve policy risk in September and beyond, saying positioning signals currently "do not give a clear direction." It also flagged a likely rise in corporate credit bond issuance after the U.S. Labor Day holiday and September's typically high seasonal volatility for U.S. equities. Based on this, the trading desk advised investors to "reduce net long exposure" and consider a "market neutral" strategy, explaining that portfolios should rely less on one-sided upside when directional clarity is low and macro event windows are dense.
JPMorgan's trading desk said on Sept. 1 that it has turned "tactically cautious" in the near term, expecting markets to get "bumpier" over the next two to three weeks. The desk said a "sharp pullback" at the index level is not necessarily on the cards, but more turbulence could show up in sectors and individual stocks.
On risks, the desk pointed to Fed policy risk in September and beyond, unclear positioning signals, a possible pickup in corporate credit issuance after the Labor Day holiday, and September's typically high seasonal volatility for U.S. stocks. Against this backdrop, it advised investors to "reduce net long exposure" and consider a "market neutral" approach, arguing that portfolios should rely less on one-sided upside when directional clarity is low and macro event windows are dense.
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