JPMorgan urges 'buy the dip,' takes contrarian bullish stance on the market and says to cherish the 'golden pit.'

BlockBeats news, September 14 — All three major U.S. stock indices fell together. U.S. stocks suffered a sell-off on Monday, with the Dow, S&P 500, and Nasdaq opening down 0.2%, 0.7%, and 1.2%, respectively. The Nasdaq 100 dropped to a six-week low; the Philadelphia Semiconductor Index plunged as much as 5.9% at one point, with chip stocks such as Nvidia, Intel, Micron, SanDisk, and SK Hynix broadly falling 5% to 7%.

The sell-off was mainly driven by a combination of concerns over slowing AI development, surging oil prices, and rising expectations for U.S. inflation and interest rate hikes. Anthropic CEO Dario Amodei recently called for slowing the development of frontier AI models, triggering market worries that tech giants may cut AI capital expenditures; at the same time, Brent crude rose above $105, and U.S. core CPI rose 0.3% month-on-month in August, significantly increasing market expectations that the Federal Reserve will raise rates by 25 basis points this week.

However, Mislav Matejka, head of global and European equity strategy at JPMorgan, still maintained a bullish stance. He believes that although rising oil prices will pressure valuations, as long as U.S. corporate earnings growth does not deteriorate significantly, investors should not blindly turn bearish on U.S. stocks. If the Middle East situation eases later, or third-quarter earnings exceed expectations, the current pessimism could instead drive a rapid market rebound.

JPMorgan had previously raised its year-end target for the S&P 500 from 7,800 points to 8,000 points and expected earnings per share for constituent stocks to grow 29% year-on-year to $350. Matejka advised investors to view the current market pullback caused by high oil prices and rate hike fears as an opportunity to buy on dips, and to watch for potential catalysts from the October to November earnings season.