With the UK and US stock markets reaching record highs in 2025, warnings are emerging of an incoming correction, or maybe even a full-blown crash. And one of the latest calls for caution has come from Jamie Dimon, the CEO of America’s largest bank, JP Morgan Chase.
Earlier this month, the multi-billionaire investor announced his concerns in an interview with the BBC that stock prices could fall sharply, citing geopolitical uncertainties, global remilitarisation, government spending, and high stock valuations.
But when is this house of cards expected to come crashing down?
The next crash
Timing the market’s hard. And even an investor as successful as Dimon noted he’s unable to accurately predict what will happen next.
As such, his projected timeline for a potential market correction or crash is pretty vast, spanning anywhere from within the next six months (by April 2026) all the way out to two years (October 2027).
And that seems to match the rhetoric of a growing number of institutional asset managers who have begun advising clients to be more cautious.
For example, Trevor Greetham, portfolio manager at Royal London Asset Management, said he remains bullish on the long-term potential of US stocks. But with rising short-term uncertainty, investors should look to rebalance and avoid being too concentrated in US stocks in case the ‘bubble’ does indeed burst.
What now?
Despite the warnings coming from expert investing minds, it’s important to highlight that a stock market correction, or even crash, may not actually happen.
Cooling of geopolitical tensions, efficiency gains from AI, and steady interest rate cuts could allow earnings to catch up to valuations, deflating bubble concerns. In fact, we’ve already seen analysts upgrade earnings forecasts for US businesses in 2026 despite all the uncertainty.
But let’s assume the worst and say that a downturn’s coming. What can investors do to prepare?
One of the best tactics is to do is what Greetham and Dimon have hinted at – diversify. There are plenty of opportunities in defensive sectors like healthcare today that help mitigate the impact of sudden, unexpected volatility.
Take AstraZeneca (LSE:AZN) as a prime example that’s worth considering.
Even during an economic meltdown, demand for life-saving medicines doesn’t disappear, and the business has historically proven to be quite resilient. And with an impressive pipeline of late-stage drug candidates inching closer to reaching the market, the business could be primed to thrive for many years to come. That’s why I think nervous investors may want to take a closer look.
Of course, even defensive businesses aren’t without their risks.
The pharmaceutical sector’s currently facing a troubling patent cliff with many blockbuster drugs losing their protected status over the next five years. AstraZeneca’s development pipeline helps offset this risk, but any delays in clinical trials or regulatory approvals could translate into revenue and profit slowdowns as generic manufacturers steal market share. But I still see it as a business primed for growth.
The bottom line
The stock market will crash again. But just when is unknowable, and even Dimon’s forecast could be wrong with the current bull market continuing for many years to come.
Nevertheless, by preparing for the worst and hunting down terrific stocks to buy when prices do fall, investors can position their portfolios to deliver jaw-dropping returns over the long run.
