A Dow spiral? Not under Trump’s watch, a JP Morgan analyst claims. | Source: AP Photo/Jacquelyn Martin
By CCN Markets: The Dow Jones chalked up back-to-back losses this week, but don’t fear an all-out crash. Trump won’t let it happen, says JP Morgan’s top analyst.
As trade war fears persist, Marko Kolanovic said Trump would sooner sign a trade deal with China than let the US economy fall into recession on his watch. With the 2020 election looming, there’s no way Trump will let the stock markets crash, the JP Morgan analyst affirmed.
“If there is a trade deal, which would be rational to expect going into election year, we think that about half of the market damage could be quickly reversed.”
Dow creeps higher on Thursday
Dow futures crept higher in early trading on Thursday, putting the DJIA on track to snap its back-to-back losses.
Markets have been volatile since early May when Trump pulled the plug on China negotiations and hit the country with higher tariffs. At the same time, traders are trying to price in the possibility of rate cuts at the Federal Reserve.
There will be no “Trump Recession”
A host of Wall Street banks have sounded the recession alarm in recent weeks. As CCN reported, Morgan Stanley analyst Michael Wilson said even lower interest rates might not prevent a recession.
“Fed could cut as soon as July but it may not halt slowdown/recession.”
Kolanovic poured cold water on the threat of recession.