Morgan Stanley’s Wilson Says Stock Rally Will End If Profits Dip
- S&P 500 earnings estimates have been falling since November
- Morgan Stanley, JPMorgan among most negative on US stocks
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A rally that’s pushed US stocks to a new record this year will stall if company earnings disappoint, according to two of Wall Street’s most bearish strategists.
Morgan Stanley and JPMorgan Chase & Co. are growing concerned as the outlook for profits has been weakening even as the S&P 500 reaches fresh highs. Equity gains over the past five months have been driven by easier financial conditions and higher valuations rather than improving fundamentals, according to Morgan Stanley’s Michael Wilson.