a top jpmorgan chase  co analyst who has been warning clients to stay away from stocks all year is doubling down and advising them to increase their allocations to cash and gold jpmorgan chief global markets strategist marko kolanovic advised clients to modestly reduce their exposure to us stocks and corporate debt and up their holdings of cash and shortdated treasury bills that carry yields north of 5 “even aside from the debt ceiling issue we maintain that the riskreward for equities is poor given elevated risk of recession stretched valuations high rates and tightening liquidity and we favor cash over equities at the former’s 5 yields” a team led by kolanovic said in a note shared with marketwatch kolanovic and his team also recommended traders shift exposure away from crude oil which has sunk this year on recession fears and buy more gold which has rallied since late last year although it has reversed some of its yeartodate gains over the past few weeks “within commodities we rotate from energy given recession risks and a potentially fading china growth impulse to gold following its recent selloff on its safehaven demand and as a debt ceiling hedge” the analysts said gold futures expiring in june gcm23 have fallen to 1975 after trading as high as 2085 earlier this month see even a mild recession could cause stocks to crater by 15 or more jpmorgan’s kolanovic says since the start of the year kolanovic has pushed back against expectations that looming interestrate cuts from the federal reserve could help to boost stocks in his view rate cuts would require a recession strong enough to bring down inflation and the market with it creating a catch22 for investors the jpmorgan strategist also argued that stocks are overvalued a view that is shared by many on wall street who have been skeptical of the market’s durability since the start of the year the sp 500 index touched its highest intraday level of the year on friday when it briefly broke above 4200 a level that has been a durable ceiling for stocks since august the sp 500 spx is up 89 so far this year according to factset data while the nasdaq composite has risen a whopping 214 as shares of technology giants like microsoft corp msft and semiconductor players like nvidia corp nvda have benefited from the ai craze the forward pricetoearnings ratio for the sp 500 stood at 183 on tuesday according to factset that is below the 5year average of 186 but above the 10year average of 173