JPMorgan Warns of Autumn Stock Downturn, Sees AI Echoing 2000 Peak

JPMorgan is telling clients to prepare for turbulence into the fall. The bank sees growing risk of a late-summer or early-autumn drawdown even with major indexes still trending higher, and it is drawing uncomfortable comparisons between today’s AI leaders and the 1999-2000 tech peak.

What JPMorgan actually said

JPMorgan strategist Jason Hunter flagged that the bank sees growing risks of a late-summer or early-autumn market downturn despite major indexes remaining in bullish trends, pointing to weakening market internals, defensive rotation and fading conviction in AI.

Hunter framed the current tape as a mix of forced position unwinds and a rotation out of crowded tech. He described it as an unrelated combination of position unwinds, attempts to rotate away from crowded Technology exposure and a shift into portions of the market that could be construed as defensive in nature.

The 2000 parallel

Hunter also said artificial intelligence stocks are showing similarities to the moves that occurred in the 1999-2000 period, when tech stocks skyrocketed only to crash and send the broader market into a bear market.

On the hyperscalers specifically, JPMorgan noted that while there was some rotation into the underperforming group as hardware set back, the moves were uneven within the group, and the broad basket of these stocks remains below key 2026 range resistance.

Given the similarities to what unfolded in 1999-2000 within the latter stages of the communications equipment capex investment cycle, the bank continues to see these market developments as a meaningful risk heading into post-Labor Day seasonality.

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Credit is already flashing

The warning is not just about equities. CCC-rated spreads have been widening for eight months while the S&P 500 has continued climbing to new highs, a divergence that historically precedes trouble in risk assets.

Junk credit and stocks tend to move together. When they split for this long, it usually says something about underlying risk appetite.

Options market and stocks to watch

Traders should watch how AI and hyperscaler names trade into post-Labor Day seasonality, and whether credit continues to diverge from equities.

• NVDA: watch for how the AI trade holds up if positioning unwinds accelerate into earnings.
• MSFT: watch for hyperscaler capex commentary and whether shares can reclaim 2026 range resistance.
• GOOGL: watch for rotation flows as investors reduce crowded tech exposure.
• SPY: watch for whether internals confirm new highs or continue to weaken.
• JPM: watch how the bank’s own tape reacts if credit spreads keep widening.

More market coverage is available in other news.

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