JPMorgan keeps cautious emerging market calls after hawkish Fed shift

FILE PHOTO: A view of the exterior of the JP Morgan Chase & Co. corporate headquarters in New York City May 20, 2015. REUTERS/Mike Segar/File Photo

LONDON (Reuters) - Investment bank JPMorgan said it was sticking with its cautious emerging market recommendations on Friday following this week's hawkish Federal Reserve meeting, though the "sleepy summer" it had previously predicted might now be at risk.

"As we were not positioned for a summer carry trade in local rates or FX — we are underweight EM rates and market weight (neutral) EM FX — we are not adjusting recommendations at this stage," JPMorgan said in a note to clients.

"EM markets had been gearing up for a summer of low-volatility carry with a grind better in recent weeks, so the somewhat hawkish Fed shift has put this at risk."

(Reporting by Marc Jones; editing by Carolyn Cohn)

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