Retail Revival Adds Fuel to US Stocks, JPMorgan Strategists Say

Yahoo Finance · 2026-05-28

Retail Revival Adds Fuel to US Stocks, JPMorgan Strategists Say 1 / 2 Retail Revival Adds Fuel to US Stocks, JPMorgan Strategists Say Michael Msika Thu, May 28, 2026 at 5:00 AM CDT 2 min read JPM ^GSPC (Bloomberg) -- Retail investors’ share of US equity trading is poised to rebound after falling to a four-year low by the end of the first quarter, according to JPMorgan Chase & Co. strategists, potentially providing a fresh tailwind for stocks. Singapore Hands Byju's Founder His First Ever Jail Term Iran’s Khamenei Says No Going Back for Middle East Rocked by War Ex-President Biden Sues to Stop DOJ Sharing Interview Tapes Two More Oil Supertankers Exit Hormuz to Help Push Up Flows ‘KPop Demon Hunters’ Studio Draws Tencent Music Investment “While the share of retail investors in US equity trading declined further in the first quarter to 17%, we expect a rebound in the second quarter echoing the second quarter of 2025,” the team led by Nikolaos Panigirtzoglou wrote in a note. “This would be consistent with the retail impulse we see in the options space where the call option buying by small option traders subsided between October 2025 and March 2026 but rose sharply in April/May 2026.” The performance patterns of the S&P 500 Index in 2025 and 2026 look very similar, with subdued returns in the first quarter, followed by a strong rally in the second period. The remainder of 2025 ended up providing high returns for US investors more broadly. The impulse from reinvigorated retail trading could potentially offer fresh impetus for the overall market. The JPMorgan strategists note that retail investors participated strongly in individual stock trading during the second quarter of 2025, helping equities to move higher during that period. But they have since slowed their churning in individual stock trading, with the exception of October 2025. That said, retail investors have still been a significant driver of the rally in equities, according to the team. “Despite the 2H25/Q1 2026 decline, they still accounted for close to 20% of US equity trading, and close to 50% of zero-day-to-expiry option trading.” That said, another cohort of more traditional retail investors, who favor equity funds, has been a constant support to the market during this period of slowing participation. What matters more for the stock market is not how frequently retail investors trade stocks or options, but the share of overall end-investor flows they account for, the team added. It’s Such a Mess Shopping for Reasonably Priced Menswear How Barnes & Noble Became Private Equity’s Most Radical Retail Experiment

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JPMorgan strategists predict a rebound in retail investors' share of US equity trading in Q2, after hitting a four-year low in Q1, potentially providing a fresh tailwind for the stock market. This trend mirrors 2025, with increased retail activity particularly noted in the options market.

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US Equities (S&P500) — A rebound in retail investor trading and buying interest is expected to provide positive momentum, driving overall market performance higher.
Options Market — Increased call option buying by retail investors and their significant share in zero-day options trading will boost market liquidity and volatility.
Brokerage/Fintech — Higher trading volumes from retail investors will likely increase transaction fee revenues and expand the user base for brokerage firms and fintech platforms.
Growth Stocks/Technology Stocks — Retail investors often favor growth and technology stocks, potentially leading to increased buying pressure and accelerated price appreciation in these sectors.

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