Markets have been under pressure for weeks. The feeling has changed. Most of the investors have already taken it out. This is exactly where JPMorgan chose to publish its latest note.
In a letter published on April 13, JPMorgan strategist Mislav Matejka laid out the bank’s clearest position yet on what investors should be doing now, arguing that conditions support another V-shaped recovery, despite continued global uncertainty.
“Our basic case is that any increase will not last forever, and that the decline caused by the country’s shock should prove to be a buying opportunity,” Matejka said, according to Reuters.
Matejka’s main argument is that the current sell-off appears to be driven by fear, not fundamentals. Bearish views have become the consensus view two to three weeks into the conflict, as oil prices are expected to rise sharply and investors are more risk-averse, according to Yahoo Finance.
JPMorgan’s view is that this type of sentiment capture is symptomatic. When everyone has sold, the risk of being caught on the wrong side of a recovery becomes a greater risk.
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“Military conflicts naturally show fat muscles and cause high volatility, but we resisted succumbing to bearish views as the risk of being hit increases significantly,” wrote Matejka.
JPMorgan first made the call on March 23. The bank kept it because of the volatility that followed, according to Yahoo Finance.
Matejka was very specific about why 2026 is not a repeat of 2022. He said the current situation varies greatly in terms of inflationary pressures, corporate pricing power, real prices, and the labor market.
The S&P 500’s 2026 earnings per share continued to rise in conflict. JPMorgan also said central banks should look at the expected 1.5 percent annual rate hike, viewing it as a temporary increase rather than a structural change, according to Yahoo Finance.
The global economy entered the fray on strong fundamentals, including strong job growth and income growth. That background makes a sustained bear market difficult to justify.
JPMorgan is not calling for broad, unbiased buys. The bank recommends cyclical sectors including capital goods, semiconductors, and consumer cyclicals, as well as emerging markets and the eurozone.
The bank also expects global stocks, emerging markets, small caps, and value stocks to resume strong performance, consistent with its outlook for next year, according to Yahoo Finance. Those are the areas that JPMorgan believes have been oversold during the conflict-driven rotation into defensive stocks.
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Time horizon for cumulative risk: 3 to 12 months
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First call “add exposure”: March 23, 2026
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The S&P 500 has fallen since the war began: About 8% at worst, notes Investing.com
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S&P 500 returns from March lows: About 8%, according to Investing.com
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Year-end target for the JPMorgan S&P 500: 7,200
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Popular fields: Capital goods, semiconductors, consumer cyclicals
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Popular regions: Emerging markets, eurozone
JPMorgan is not alone. Morgan Stanley strategists led by Michael Wilson say the recent sell-off in the S&P 500 looks more like a correction than the start of a prolonged slump, and they attribute their support to improving earnings fundamentals.
The alignment between the two banks on this point is remarkable. When multiple major institutions reach the same conclusion about a market move, it tends to carry more weight than a single outside call.
The bank’s position comes with a clear caveat. If the conflict progresses, oil volatility continues, or the situation begins to damage growth and supply chains in a permanent way, the recovery thesis weakens.
JPMorgan has already cut its year-end target for the S&P 500 to 7,200 from 7,500, reflecting uncertainty. A “buy the dip” call is tactical, not a clear signal. It depends on the assumption that the conflict is always contained and that a large background exists.
For investors, the message from JPMorgan is straightforward. Volatility may not be generated. But if the selloff is driven by fear rather than broken fundamentals, the biggest risk may remain on the sidelines when the market turns.
Related: JPMorgan identifies huge investment opportunity
This story was originally published by TheStreet on April 14, 2026, where it appeared first in the investing category. Add TheStreet as a favorite source by clicking here.
