Kolanovic to leave JPMorgan after series of mistimed stock market calls

Marko Kolanovic will leave his role as JPMorgan’s chief global markets strategist, ending a 19-year stint that culminated in a series of mistimed calls on the US stock market.

Kolanovic, also the bank’s co-head of global research, was among the few bearish strategists left on Wall Street, having recently forecast that the S&P 500 would tumble by almost 25 per cent from current levels by year-end.

Once dubbed “the man who moves markets” by CNBC and “Gandalf” by Bloomberg, Kolanovic’s star has fallen in recent years on a series of contrarian and ultimately mistimed calls on the direction of the S&P 500.

Two years ago he advised clients to take an overweight position in US stocks during the deep market sell-off, before switching to recommending an underweight position in early 2023. The bank has stuck with that position ever since, despite the blue-chip index having surged more than 40 per cent since then. 

Kolanovic — who graduated from New York University with a PhD in theoretical high-energy physics and went on to work at Bear Stearns and Merrill Lynch before joining JPMorgan — will now be “exploring other opportunities”, according to a person familiar with the situation. Kolanovic did not respond to a request for comment.

Hussein Malik will become sole head of global research, having previously been co-head of the department with Kolanovic, a spokesperson for the bank said.

Dubravko Lakos-Bujas, JPMorgan’s chief global equity strategist, will now lead markets strategy in a new role encompassing equities, cross-asset and macroeconomic research. Steve Dulake and Nick Rosato will co-lead “fundamental research”, a newly branded team that brings credit and equity research under one leadership structure, the bank confirmed.

A JPMorgan biography shared with the Financial Times praised Kolanovic for his “timely and accurate short-term forecasts of stock market returns”, noting that he was inducted into the Institutional Investor Hall of Fame in 2020 “following 10 consecutive years of #1 rankings”.

He and other JPMorgan strategists reiterated their bearish outlook in a note to clients last week, highlighting what they describe as an “awful” lack of breadth in the US stock market.

“Since last year, we have argued that a soft-landing outcome [for the US economy] would be difficult to engineer. Instead, a no-landing would be more likely with higher-for-longer rates until growth surrenders to restrictive monetary policy and softening macro backdrop,” the team wrote in late June.

Despite their preference for high-quality, large-cap stocks, the team admitted they had “under-appreciated the resiliency of [the Magnificent Six] in terms of price momentum and earnings revisions”, in a reference to the handful of stocks that have driven the vast majority of the S&P 500’s recent gains.

The index this week rose to a fresh all-time high. The S&P 500 equal-weighted index, however, is largely unchanged over the past two-and-a-half years, while the small-cap Russell 2000 has added just 0.3 per cent in 2024.