JPMorgan thinks positive regarding United States stocks, despite all the negative swirling around the stock market.

JPMorgan-thinks-positive-regarding-United-States-stocks“Buy equities,” Dubravko Lakos-Bujas, the Wall Street firm’s U.S. equity strategist, told clients, reiterating his call for the S&P 500 stock index to finish the year at 3,000.

JPMorgan believes still-strong business conditions and the fact stocks are still selling below their historical valuations will enable stocks to overcome “negative narratives.” He also says the effects of the U.S. proposal to levy tariffs on at least $50 billion of Chinese imports will be smaller than feared.

It might also lead to positives like “greater liberalization” of markets and agreements on intellectual property rules. The S&P 500, he points out, is still about 5% below where it was two weeks ago and also lower than it was before the tax reform bill was passed late last year.

The drop in stock prices, however, has come at a time when corporate America is exhibiting higher growth. It is going to expand profit margins. And is using cash to buy back their own shares. And at the same time investors have decreased risk in their portfolios.

Stock valuations “look even cheaper if taken in the context of low global interest rates.” There’s also room for earnings estimates to move higher as a result of the benefits from tax cuts. All this “represents a buying opportunity,” he says.

All that selling have engulfed markets in the past 8 weeks. It has had little to do with the health of the economy or Corporate America. That’s why he says the recent slide “represents a buying opportunity.”