JPMorgan Chase's trading desk has turned bullish on US stocks, with a focus on tech and banking shares.

Ahead of the release of the U.S. September non-farm payrolls report, JPMorgan’s trading desk has ended its previous tactical neutral stance on U.S. stocks and shifted back to a bullish outlook, focusing on the technology and banking sectors. Andrew Tyler, JPMorgan’s head of U.S. market intelligence, stated that stronger-than-expected U.S. economic activity, resilient consumers, solid corporate earnings growth, and the likely gradual stabilization of bond yields make the current market environment more favorable for risk assets. Tyler noted that the technology sector remains a key bullish pick, with semiconductors and the "Magnificent Seven" set to continue outperforming, while the artificial intelligence theme is far from over. For cyclical stocks, JPMorgan prefers bank stocks, arguing that a renewed acceleration in economic growth, a potential steepening of the yield curve, and improved capital market activity will support bank shares. The bank also added that as oil prices and bond yields face possible declines, small-cap stock shorts are at risk of being covered, so it no longer recommends using a short position on the Russell 2000 Index as a direct hedge for long tech positions. The next key market focus is the U.S. September non-farm payrolls report, set to be released this Friday. A Bloomberg survey forecasts around 90,000 new non-farm jobs, with the unemployment rate holding steady at around 4.1%. Federal funds futures indicate the market currently prices in a roughly 65% probability of another interest rate hike by the Federal Reserve in October.