- It's a big swing for the bank which at the start of the year saw good things for small and midcaps thanks to Trump's promises of tax cuts and infrastructure spending.
- The new administration's focus, however, appears to be on trade, says JPMorgan's Eduardo Lecubarri, which adds downside risk to the 2017 outlook. “We worry about big short-term shocks to the global economy at this stage of the game.”
- Small and midcaps have been especially popular since the Trump election, with the S&P Small Cap 600 Index higher by 18% the last three months, and the S&P Mid Cap 400 by 14% vs. the S&P 500's 9% advance.
- It's time to purchase some downside protection, says JPMorgan.
- ETFs: IWM, TZA, TNA, UWM, VB, MDY, IJR, VO, SLY, IJH, MVV, SCHA, RWJ, URTY, TWM, MIDU, RWM, EZM, SRTY, SCHM, RWK, IWR, UMDD, VTWO, SAA