JPMorgan strategist Mislav Matejka’s team believes that technology stocks will struggle to replicate last year’s performance in the second half of 2026. On Monday Eastern Time, the S&P 500 rose 1.5% to 7,600.50, the Dow Jones Industrial Average gained 693 points to close at a record high, and the Nasdaq rebounded 2.1%. JPMorgan noted that the market remains skeptical about whether major cloud providers’ AI-related capital expenditures will translate into free cash flow, and that AI’s substitution effect is suppressing valuations in sectors such as software, business services, and media. Funds are once again flowing into consumer cyclicals, industrials, financials, and non-U.S. stocks, signaling a broadening of market leadership across other sectors.
JPMorgan: U.S. market leadership to shift from AI and tech stocks in H2 2026
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JPMorgan strategist Mislav Matejka warned that the U.S. market’s focus may shift away from AI and tech stocks in H2 2026. On Monday, the S&P 500 rose 1.5% to 7,600.50, the Dow reached a new high, and the Nasdaq gained 2.1%. The firm questioned whether AI spending by cloud providers will drive free cash flow, as the substitution effect continues to pressure software and media valuations. With the Fear & Greed Index showing mixed signals, consumer cyclical, industrial, and financial sectors are attracting renewed interest. Investors are also monitoring altcoins as market leadership broadens.
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