In late May, JP Morgan's Marko Kolanovic defended his stubborn, negative stance on the U.S. stocks, asserting that the S&P 500 was substantially overvalued, and predicted that the big cap index would end the year at 4200, down 24% from its level at the time. By then, Kolanovic was the last bearish market strategist at a major Wall Street bank; all the others, even the previously dour ones, were predicting more gains by year end on the view that the fabulous resurgence that started in early 2023 would just keep rolling.
Kolanovic had also been wrong in 2022 when he foresaw great things for equities, and the markets tanked. It appears that missing by a wide margin on back-to-back forecasts, over two-and-a-half years, cost him his job. But does his analysis of the market's fundamentals was wrong? Not at all.
