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Wall Street Strategists Say Stocks Rally at Odds With Profit Outlook

  • MS’s Wilson says ‘best part’ of the stocks rally is over
  • GS cuts 2023 profit margin estimates on input cost pressures
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Morgan Stanley's Wilson Says Fed Pivot Talk Is Premature

A dimming earnings outlook is at odds with the recent rebound in stock markets, according to strategists at Morgan Stanley and Goldman Sachs Group Inc.

Both Morgan Stanley’s Michael J. Wilson and Goldman’s David J. Kostin expect corporate profit margins to contract next year given unrelenting cost pressures, they wrote in separate notes. According to Wilson, who has been one of the most vocal bears on US stocks, “the best part of the rally is over.”