Issuer earnings prospects in 2022 are bright, these are JP Morgan’s 10 preferred stocks

Reporter: Nur Qolbi | Editor: Novice Laoli

KONTAN.CO.ID – JAKARTA. Financial services company and multinational investment bank JP Morgan has a more optimistic view than consensus on the issuer’s earnings growth in 2022. This applies to most of the countries it covers, except China.

JP Morgan favors developed markets over emerging markets. “However, we are more concerned about the quality of the underlying business drivers and sources of income than about jurisdictions,” said Investment Strategist JP Morgan in a recent report entitled Outlook 2022 Preparing for a Vibrant Cycle.

According to him, some investors are also worried that profit margins will deteriorate. However, according to JP Morgan, increases in prices and productivity will offset increases in inputs and labor costs.

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Currently, the global economy is in the growth phase of the market cycle. At this stage, income growth is predicted to drive equity market returns so that investors can earn profits.

For 2022, JP Morgan predicts a more even distribution of returns across sectors and companies, not just concentrated on the biggest players. Even so, the technology and financial sectors are JP Morgan’s favorites.

This is because these two sectors function as portfolio diversifiers because they react in the opposite direction to changes in interest rates. Both sectors will also be pushed higher with strong revenue growth.

In terms of its valuation, the current stock price is not considered undervalued, but rather are at the best valuations in most markets.

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