JPMorgan: there's a solid contrarian indicator pointing to an impending rise in the stock market of more than 10%

Banking giant JPMorgan notes that the number of jobless claims recently jumped 10% from the previous three-month average. And every time this has happened in history, the economy has eventually fallen into recession.

Bank analyst Mislav Matejka said in a note to investors there were no false signals on that indicator. "Unlike the shape of the yield curve or the money supply, which are leading indicators, this one is more congruent."

But there is good news for investors. JPMorgan says that whenever this indicator fails, the S&P 500 returns an average of 11% over the next 12 months.

Keeping that in mind, there are two stocks that JPMorgan finds particularly attractive right now.

AAPL

No one who spends $1,600 on a fully stocked iPhone 13 Pro Max would call that a steal. But consumers still love spending money on Apple products.

Company's management reported earlier this year about active installed base exceeded 1.65 billion devices, including more than 1 billion iPhones.

While competitors offer cheaper devices, millions of users don't to give up on the Apple ecosystem. The ecosystem is a some kind of an economic moat, generating windfall profits for the company.

It also means Apple can pass on higher costs to its global consumer base as inflation rises without worrying too much about falling sales.

Apple will hold an event on September 7th, which is when many expect the company to unveil the iPhone 14 line.

NVDA

Nvidia is the leading graphics card maker and it facilitates the stock growth, which can be seen over the past decade. But that rally came to an abrupt halt in November 2021. The stock has fallen more than 55% since peaking at $346 in late November.

Nvidia's fall is significant even when compared to other fallen stocks in the semiconductor sector.

Nvidia's business is still on the right track, which makes it a particularly intriguing contradiction. The chip maker generated $6.70 billion in revenue in its second fiscal quarter. The amount increased by 3% compared to last year.

Data center revenue increased 61% year-over-year to $3.81 billion.

JPMorgan analyst Harlan Sur recently lowered Nvidia's target price from $230 to $220. Nevertheless, Sur maintained an "above market" stock rating, and the new target price still suggests a growth potential of 46%.