Analysts at JPMorgan have picked their likely winners and losers for the second half of 2022, naming stocks set to do well — or badly — when factors such as inflation, bond yields and oil prices are taken into account. After a turbulent first half, which saw Russia invading Ukraine and rising inflation, the Federal Reserve raising interest rates, the analysts have identified some trends that will be evident over the next months. This has contributed to market losses. In a research note dated June 6, Mislav Matejka, JPMorgan’s analysts stated that they expect inflation to rise and bonds yields to remain steady. As we near 2H, the fundamental risk-reward ratio for equity is expected to improve. We have possibly passed peak Fed fear, on the policy side. Bond yields are at a steady level, there has not been any curve flattening, and USD is stagnating. They will be joined by an expected peak in inflation on a Yoy basis. [year-over-year]They stated that they would change the basis. JPMorgan’s sector weighting is high for energy, bank, automobiles, and miners. The bank also picked several stocks in multiple baskets. It identified the “Beneficiaries” and “Losers” of rising inflation. ENI, Repsol and Volvo were the beneficiary stocks, along with financial companies Credit Suisse, BNP Paribas, Credit Suisse, and BNP. Consumer goods companies Unilever & Diageo were the “losers” due to increasing inflation, along with Novartis and AstraZeneca. Read more Adobe, an energy ETF and more: CNBC’s ‘Halftime Report’ traders answer your questions Why the market gets nervous whenever the 10-year Treasury yield hits 3% Ford tops the list of the cheapest stocks in the market right now JPMorgan also listed stocks it believes will likely to do well — and poorly — when bond yields rise. After reaching its highest point in nearly a month, Wednesday’s yield on the benchmark 10-year Treasury bond was 3.0123%. According to the bank, financial institutions ING Group ING Group ING Group COMMERZBANK, Societe Generale & Standard Chartered were beneficiaries while utilities companies Severn Trent / SSE & United Utilities were considered “bond yield losers”. The bank also sees further earnings growth in Europe and noted that all sectors aside from real estate are seeing net upward earnings-per-share (EPS) revisions — EPS is a measure that investors use to assess a company’s profitability. According to the bank, there will not be any recession in Europe. “Financial terms are becoming more difficult, but they won’t be as severe in the longer term. The labour markets are robust and [the]According to its analysts, the consumer has an adequate amount of savings left over. JPMorgan selected 40 high-yield European stocks with strong balance sheets and safe dividends. They included the automakers Stellantis, Mercedes-Benz, as well as financial institutions Aviva, Danske Bank, and industrials firms Maersk, Randstad, and Danske Bank. This report was contributed by Elliot Smith, CNBC.
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Analysts JPMorgan have picked their likely winners and losers for the second half of 2022, naming stocks set to do well — or badly — when factors such as inflation, bond yields and oil prices are taken into account.
