S&P 500 May See 1,700

JPMorgan’s Dubravko Lakos-Bujas, head of U.S. equity and quantitative strategies, sees more pain ahead for equities.

“As far as this quarter is concerned, we’re calling for anywhere from a 2-3 percent earnings surprise. Buyback activity is likely going to start picking up as late January to early December was a quitter period. So all of these elements in the short-term might support equities.”

However, Lakos-Bujas was quick to mention that this data is overshadowed by concerns for the next three to six months.

“U.S. manufacturing sector is already in recession territory and that the non-manufacturing sector continues to decelerate.”

“[A recession] is a possibility, but I wouldn’t say that. I would more so say that [there’s] concern over a bear market. With the S&P around 1,900 right now, that could mean we maybe see 1,700 at some point.”