JPMorgan Sees 10% Correction in S&P 500 as War Risks Build Up

JPMorgan Chase's trading desk warns the S&P 500 could drop as much as 10% from its peak due to the war in Iran. The note says US equity traders are under-positioned and unprepared, implying a sharp risk-off move and elevated volatility if the conflict intensifies. Portfolio managers should consider downside hedges and reassess positioning given the heightened tail-risk to market breadth and flows.

Analysis

JPMorgan Chase's trading desk warns the S&P 500 could drop as much as 10% from its peak due to the war in Iran. The note says US equity traders are under-positioned and unprepared, implying a sharp risk-off move and elevated volatility if the conflict intensifies. Portfolio managers should consider downside hedges and reassess positioning given the heightened tail-risk to market breadth and flows.