JP Morgan says the Fed is too restrictive, cuts ahead, but cautious; Magnificent 7 strong

J.P. Morgan asset management global market strategist Jack Manley spoke in an interview with Fox. In brief:

• believes the Fed’s current policy stance is too restrictive given the mixed signals in the economy
• sees justification for starting a rate-cut cycle
• doubts the Fed will cut aggressively because labor markets remain tight, wages are growing, and consumers overall are resilient
• Manley says that low- and middle-income households are under strain, stresses that higher earners drive most of the economy’s momentum

On markets,

• highlights the durability of the Magnificent 7 earnings story but expects a longer-term rotation toward broader S&P 500 participation, with earnings growth between big tech and the rest converging by 2026

The full interview is here:

• There are plenty of arguments for easing rates, but Fed Reserve should be cautious, argues market strategist

This article was written by Eamonn Sheridan at investinglive.com.