One Wall Street strategist is cautious of the near-term market outlook, even because the consensus grows extra optimistic. JPMorgan equity strategist Dubravko Lakos-Bujas is frightened the S & P 500 may undergo a close to time period pullback of roughly 5% to eight%, equal to the benchmark index slumping as little as 6,200 or 6,000, respectively, and warned that August’s CPI, set for release Thursday morning, may very well be the catalyst for a correction. The broad market index closed Tuesday at an all-time excessive, above 6,500. Investors can defend themselves towards draw back threat through the use of an choices technique, Lakos-Bujas suggested. “After one of the strongest rallies in decades, we would recommend near-term caution with the market pricing in aggressive rate cuts at a time when inflation prints are expected to ramp up, investor positioning is elevated, and Sept-Oct performance is seasonally weak,” Lakos-Bujas wrote on Wednesday, earlier than the release of softer-than-expected August producer worth information. “If inflation comes in hotter this week, we see the current goldilocks market positioning at risk of correcting,” the strategist added. .SPX YTD mountain S & P 500, 12 months to this point The near-term forecast that the S & P 500 may fall as little as 6,000 can also be the place Lakos-Bujas expects the S & P 500 will finish 2025. The JPMorgan strategist has the bottom year-end forecast on the Street, based on a frequently up to date CNBC survey . On common, strategists anticipate the benchmark will finish the 12 months at 6,498, roughly the place the index is buying and selling at this time. Lakos-Bujas’ bearish near-term name comes as others on Wall Street flip extra optimistic available on the market outlook, particularly after Oracle ‘s newest income projections confirmed AI prospects that had been much more gorgeous than analysts had been predicting. Indeed, Wells Fargo, Deutsche Bank and Barclays all raised their S & P 500 targets on the again of a heightened AI commerce, in addition to diminishing results from increased tariffs. To be certain, Lakos-Bujas himself additionally expects any near-term correction will shortly give approach to additional upside, aiming for a medium-term S & P 500 goal of 7,000 someday in early 2026. More instantly, the strategist worries {that a} “goldilocks” market that has to this point shrugged off issues of financial weak spot and guess as an alternative on the Federal Reserve stepping in to experience to the rescue, may very well be in for a impolite awakening — particularly if the inflation information doesn’t cooperate. Indeed, Lakos-Bujas wrote that JPMorgan’s economists are anticipating a pickup in inflation. “With six rate cuts currently priced in by the end of 2026, we believe risky assets may be vulnerable at a time when tariff-induced inflation is starting to flare-up, possibly restraining the Fed’s forward easing path — the next risk event is the upcoming August CPI release,” Lakos-Bujas wrote. — CNBC’s Alex Harring contributed to this report.