Live Markets: The pain trade is on the upside
15/04/2026 11:49
Adds blog post STOXX 600 down 0.2% Oil prices rise Luxury stocks fall after Kering, Hermes results Wall St edge lower Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com THE PAIN TRADE IS ON THE UPSIDE Equity derivative strategists at JPMorgan believe that many investors have been caught off guard by the speed and strength of the recovery in equity markets, but think there could also be further to run. The STOXX 600 .STOXX, for example, is 10% above its March 23 low, while the S&P 500 .SPX is trading above the level it was at before the war in the Middle East started in late February. "We believe the pain trade remains to the upside," writes JPM. "Absent a renewed escalation – something neither negotiating side appears to want –markets are likely to grind higher." They note that Germany's DAX .GDAXI and Switzerland's SMI .SSMI have recovered just over half of the drawdown from the start of the war, substantially less than across other indices which have largely recovered, or indeed exceeded their pre-war levels. They believe the two indexes "look promising" and recommend buying exposure via May 26 call spreads. For investors who want to position for a breakdown in negotiations and re-escalation of the conflict, JPM recommends buying May 26 put spreads on the FTSE 100 .FTSE. "The index offers low volatility, a good spot entry point given how much the index has already recovered the war drawdown and the index displayed downside reactivity as markets corrected, even if slightly less than other indices," they write. (Samuel Indyk) ***** FOR WEDNESDAY'S OTHER LIVE MARKETS POSTS: FRANCE WASTED 2025, SAY SOC GEN, WHO SEE LITTLE REASON FOR OPTIMISM CLICK HERE WHY THE DOLLAR MIGHT BE READY FOR A NEW RALLY CLICK HERE STOXX FLAT AS TECH NAMES OFFSET LUXURY FALLS, WAR JITTERS CLICK HERE EUROPE BEFORE THE BELL: FUTURES MIXED, EARNINGS IN FOCUS AFTER RALLY CLICK HERE STOCKS RISE, BLOCKADE HOLDS, TALKS MAY RESUME CLICK HERE How US markets have performed over the past year https://www.reuters.com/graphics/AUTOMATED-20260414/US-INDEX-COMPARISON-365D/myvmyxgmgvr/chart.png Stocks JPM https://fingfx.thomsonreuters.com/gfx/mkt/klpylbzlrvg/Pasted%20image%201776248603016.png