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Pro Analysis

JPMorgan changes bearish tune on Dow with Brexit risk gone

Dow Chemical Plant in Stade, Germany
Source: DOW Chemicals
Dow Chemical Plant in Stade, Germany

JPMorgan upgraded Dow Chemical to overweight from neutral, as global demand for the chemical company is better than expected in the wake of June's Brexit vote.

The firm had downgraded Dow at the end of June, but not for fundamental reasons, it said. Dow has traded poorly in the past in the face of similar economic shocks..

"We were reluctant to add to Dow positions following the exit of Great Britain from the European Union, thinking that cyclical risks had simply risen too high," JPMorgan analyst Jeffrey Zekauskas wrote in a note to clients.