Markets have been under pressure for weeks. Sentiment has turned. Most investors have already de-risked. That is exactly when JPMorgan chose to publish its latest note.
In a note published April 13, JPMorgan strategist Mislav Matejka laid out the bank’s clearest position yet on what investors should be doing right now, arguing that conditions support another V-shaped recovery, despite ongoing geopolitical uncertainty.
“Our base case remains that any further escalation is unlikely to be sustained indefinitely, and that dips driven by geopolitical shocks should ultimately prove to be buying opportunities,” Matejka said, according to Reuters.
Matejka’s key argument is that the current sell-off looks driven by fear, not fundamentals. Bearish sentiment had become the consensus view just two to three weeks into the conflict, with oil prices widely expected to spike further and investors heavily de-risked, according to Yahoo Finance.
JPMorgan’s view is that this kind of sentiment capitulation is itself a signal. When everyone has already sold, the risk of being caught on the wrong side of a recovery becomes the bigger danger.
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“Military conflicts inherently display fat tails and drive elevated volatility, but we argued against succumbing to bearish views as the risk of getting whipsawed increases significantly,” Matejka wrote.
JPMorgan first made this call on March 23. The bank has maintained it through the subsequent volatility, according to Yahoo Finance.
Matejka was direct about why 2026 is not a repeat of 2022. He said the current environment differs meaningfully in terms of inflation pressures, corporate pricing power, real rates, and the labor market.
S&P 500earnings per share estimates for 2026 have continued to move higher through the conflict. JPMorgan also said central banks should look through an anticipated 1.5 percentage point rise in year-on-year inflation, viewing it as a temporary spike rather than a structural shift, according to Yahoo Finance.
The global economy entered the conflict with relatively strong fundamentals, including solid activity momentum and earnings growth. That backdrop makes a sustained bear market harder to justify.
JPMorgan is not calling for broad, indiscriminate buying. The bank recommends cyclical sectors including capital goods, semiconductors, and consumer cyclicals, as well as emerging markets and the eurozone.
