Marko Kolanovic On S&P 500 Target, Election And Value Stocks

On CNBC’s “Fast Money Halftime Report,” JPMorgan's Global Head of Macro Quantitative and Derivatives Research Marko Kolanovic said the firm is broadly positive on equities with a 3,600 target for the S&P 500.

He said the price target is based on a view of the recovery of the economy that's going to happen after the election (no matter who wins), unprecedented monetary stimulus, as well as positioning.

Kolanovic said they believe equity investors are below average invested in equities and as volatility declines, they believe half of the market should be higher.

When asked what he thinks is and isn’t priced in already regarding the election, Kolanovic said, “What is priced in now is, I think, largely Biden’s win.”

See Also: How The Stock Market May React To A Contested Election

When asked about the potential impact of the second wave on the economy, Kolanovic said the second wave is not as deadly and they believe the vaccine will come relatively soon, whether it's one, two or three months. He believes the markets will look through any kind of second wave.

Kolanovic believes investors will move to value post-election and/or with a vaccine.

“Post-election, no matter who is president, the economy needs to start reopening,” said Kolanovic.

JPMorgan believes reopening will accelerate no matter who is elected president. That, along with the upcoming vaccine, will be the two catalysts that will help investors move back into value.