TechFlow news, March 13 — According to Jinshi News, JPMorgan strategists believe the worst phase of the U.S. stock market correction may be over, with credit markets indicating a low risk of economic recession. Strategists Nikolaos Panigirtzoglou and Mika Inkinen noted in a report on Wednesday that, compared to equity and interest rate markets, credit markets—which have delivered accurate signals multiple times over the past two years—are less concerned about the risk of a U.S. economic downturn.
Analysis shows that smaller companies, which are more sensitive to economic growth, are better suited for gauging cyclical risks in the U.S. Currently, small-cap markets reflect a recession probability of around 50%, consistent with expectations in interest rate and commodity markets. However, the U.S. debt market implies a recession probability of only 9% to 12%. Recent market adjustments have been primarily driven by position rebalancing among quantitative funds, rather than fundamental or actively managed investors reassessing the risk of a U.S. economic recession.
