JP Morgan cuts S&P 500 year-end target

J.P. Morgan Securities cut its 2011 year-end target for the S&P 500 index to 1350 from 1475, to reflect the loss of 100 points in the past two weeks, but did not rule out a December rally owing to constructive US economic data.

JP Morgan's chief US equity strategist Thomas Lee is still upbeat on US equities on improving consumer spending, declining jobless claims, easing inflationary pressures and a stabilizing housing market.

"Equities remain undervalued relative to other risky assets," Lee wrote. Earlier this month he forecast a December rally on the back of a still expanding economy.

US stocks, which recently took a severe battering on negative investor sentiment, saw their sixth straight day of losses on Wednesday on mounting concerns over the European debt crisis, coupled with weak Chinese factory data.

Despite current disappointing market trends, Lee said low cost of US corporate funding and corporates buying in bulk were positive signs.