2022 has started out with a marked increase in market volatility, accompanied by a sharp reversal of last year’s bullish trend. The sudden correction, and the shift to a more downbeat investor sentiment, are generally attributed to a series of increased risk factors. On the international front, these tensions include geopolitical tensions on the Russia-Ukraine border and around China’s belligerence. Domestically, factors impacting the markets include the inflation that is both high and rising; and the prospect of higher interest rates from the Federal Reserve.
That last factor has been getting a lot of airtime recently. The Fed is widely expected to enact a half-percent rate increase next month, and at least two more such hikes by the end of the year. However, according to JPMorgan’s Chief Global Markets Strategist Marko Kolanovic, these potential rate hikes are no reason for investors to worry.
“We believe risky asset markets have mostly adjusted to monetary policy shifts by now,” Kolanovic writes, and goes on to add, “We expect risky asset markets to rebound as they digest these risks and sentiment improves, aided by inflows from systematic investors and corporate buybacks. We thus retain a pro-risk view with a strong cyclical tilt in our model portfolio…”
So just what stocks are getting the thumbs up from JPMorgan? The firm’s analysts have picked out two stocks whose price has fallen low – but in these cases, the analysts see the low price as a gateway. We ran both names through TipRanks’ database to see what other Wall Street’s analysts have to say about them. Let’s take a closer look.
Ultragenyx Pharmaceutical (RARE)
First up is Ultragenyx, a commercial- and clinical-stage biopharma company with a focus on rare diseases. These diseases are defined by the FDA as affecting fewer than 1 in 50,000 people; as such, they have a small patient base and limited prospects for drug sales to reimburse the high costs of development. Ultragenyx spreads out those costs by operating several of its development lines in partnerships with other pharmaceutical…