‘Moment of Truth’ Arrives for U.S. Stocks After Fed-Fueled Rally
- Morgan Stanley sees market focus pivoting back to fundamentals
- U.S. banks begin reporting first-quarter earnings Friday
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It’s “gut check” time for U.S. equity investors as the pivot from a Fed-fueled rally back to the foggy fundamentals looms, according to Morgan Stanley.
“The moment of truth may be arriving with first-quarter earnings results,’’ Michael Wilson, the bank’s chief U.S. equity strategist, wrote in a note Monday. He said that this year’s stock rally can be entirely attributed to investors pushing up company valuations amid the U.S. central bank’s dovish turn, and the profit reports could mark a turning point.