Investment bank JPMorgan Chase & Co.'s JPM chief equity strategist sees the reelection of President Donald Trump as bullish for the S&P 500, Bloomberg reports.
What Happened: Dubravko Lakos-Bujas, equity strategist at America's largest investment bank, sees the S&P 500 as high as 3,900 at the year's end in the most optimistic case.
This figure is 300 points above Lakos-Bujas' base-case target for year-end 2020 and implies a 14.7% advance from Monday's close.
Many traders consider a Democratic sweep followed by a fiscal stimulus as bullish for the equity markets, but Lakos-Bujas sees a Trump victory as the most favorable outcome for stocks.
Why It Matters: A "Blue Sweep" scenario will be mostly neutral in the short-term, Lakos-Bujas said in a note.
This scenario supports positive catalysts like more fiscal stimulus and infrastructure spending, but also negative catalysts like rising corporate taxes, he said.
With the election a few days away, volatility remains high, with the CBOE Volatility Index near 30.
Related Link: Economic Recovery Could Slow In Q4, JPMorgan Chief Global Strategist Warns
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