J.P. Morgan urges caution as S&P 500 tests key support levels
SPY•J.P. Morgan strategist Jason Hunter urged cautious near-term positioning as the S&P 500 tested support near 7,507. He said a break below 7,500 could expose the index to support at 7,237-7,313, with 6,900-7,100 potentially acting as a fourth-quarter floor if that zone fails.
1. Support levels under test
J.P. Morgan technical strategist Jason Hunter said the S&P 500 was testing key price levels and that US equities could be vulnerable to a sharp shift if the index breaks below 7,500. The index had fallen below 7,600 and tested 7,507, which Hunter identified as the low of its September trading range.
2. Strategist favors defense
“We maintain a cautious near-term equity stance and favor defensive positioning until the (price) charts show either a bottoming process or capitulation,” Hunter said in a Monday note. He said selling pressure, volatility and correlation could increase sharply below the threshold.
3. Earnings and sector rotation
Recent results from technology-related companies including Alphabet and Intel added to concerns about AI investment and when that spending may generate meaningful returns. The S&P 500 ended October down 0.9%, while the Nasdaq recorded its biggest monthly decline since March 2025. Hunter said rotation into materials, financials and consumer discretionary had cushioned index declines, but downside reversals in those groups could bring a sharp rise in broad selling pressure.
