According to JPMorgan Chase, the banking giant is closely monitoring two stock sectors that are expected to drive the S&P 500 to new record highs.
During a recent episode of the Making Sense podcast, JPMorgan’s head of global market intelligence, Andrew Tyler, remains optimistic about the stock market’s performance amidst geopolitical tensions in the Middle East.
Tyler specifically highlights the technology and financial sectors as key drivers for future market growth.
“From here, the focus should be on the technology and financial sectors. The financial sector, particularly the large banks, has shown strong performance with positive outlooks from corporate management citing the strength of the consumer, a healthy loan portfolio, and robust market activity moving forward.”
Regarding the technology sector, Tyler notes that it has become more affordable in recent months as companies continue to report impressive earnings.
“Looking at the valuation from a price-earnings perspective, the earnings, both realized and expected, have been on the rise, making the sector appear undervalued. Over the past five years, the sector has been trading below the mean, with AI being a major driver of revenue and earnings growth.”
As of now, the S&P 500 (SPX) is trading at 7,135, slightly below its all-time high reached on April 27th.
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