2 June 2025 | S&P 500

Stagflation risks may limit US stock growth this summer — JPMorgan

Stagflation risks may limit US stock growth this summer — JPMorgan

According to JPMorgan Chase & Co. strategists, rising consumer prices and a potential slowdown in US economic growth could hinder the S&P 500's ability to make further gains this summer. Ongoing trade tensions between Washington and Beijing, coupled with the growing risk of stagflation, are likely to restrain American stocks from climbing up in the coming months.

Bank representatives noted that the situation with Donald Trump's import tariffs has exacerbated industry challenges in recent weeks. Despite the S&P 500 showing its best monthly performance since 2023 in May, a growing bearish sentiment has been observed among market participants.

Since the beginning of 2025, the S&P 500 has seen a modest 0.5% increase. However, according to the financial institution, the index has significantly underperformed compared to its European and Asian counterparts.

JPMorgan strategists still prefer international stocks to US ones due to the latter's overvaluation. One of the bank’s experts, Michael Wilson, predicts that the S&P 500 will likely remain at current levels over the next 12 months.

Anton Volkov MarketCheese
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