Citigroup and JPMorgan make bold predictions on the US stock market: lagging stocks will rise to the top, making a comeback in the short term.

As trade tensions ease, the two main trading departments on Wall Street are making the same bold prediction for the US stock market: buying heavily into this year's worst-performing stocks can yield quick short-term profits. The heads of the stock trading departments at Citigroup and JPMorgan have stated that they are particularly Bullish on Small Cap stocks, Technology Hardware, and Housing Construction stocks in the coming weeks, as these Sectors have lagged behind the S&P 500 Index in the recent rally. Stuart Kaiser, the head of US Equity Trading Strategy at Citigroup, mentioned that he is also optimistic about the stocks of companies with weaker financial conditions in the current environment. 'Systematic traders and discretionary investors will show significant Bids, as they failed to achieve ideal returns during this rebound,' Kaiser said. 'They are currently underweight and have substantial cash on hand to Buy into these lagging sectors.' Andrew Tyler, the head of Global Market Intelligence at JPMorgan's trading division, noted that it makes sense to buy stocks in hard-hit Industries (like Retail Trade or Consumer Discretionary) through derivatives, as these sectors may experience short covering in the near term. This situation occurs when stock prices rise sharply, forcing traders holding short positions to quickly buy back stocks to cut losses.