Leading bank urges investors to keep 'using the dips' as market leadership set to broaden

JP Morgan's equity strategy team urges investors to 'use the dips,' arguing geopolitically driven weakness is likely short-lived due to central bank flexibility and supportive earnings. With the MSCI World staging a V-shaped rebound, the bank sees limited likelihood of a prolonged conflict-driven selloff but acknowledges potential headline-driven volatility. JP Morgan expects market leadership to broaden versus a repeat of last year's Nvidia-led surge, noting Magnificent Seven P/E multiples had fallen to decade lows and AI-exposed stocks had derated, setting the stage for broader participation and potential short squeezes. The bank also highlights that the dollar and bond yields have lagged equities and could catch up, and reiterates an overweight stance on emerging markets and a constructive view on semiconductors.