Bloomberg Talks Morgan Stanley's Mike Wilson on Tariffs and Earnings
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Apr 15, 2025 Mike Wilson, a strategist at Morgan Stanley, dives deep into the uncertainties surrounding tariffs and their impact on S&P 500 earnings. He revises his earnings-per-share forecasts for 2025 and 2026, expressing concerns about the broader economic challenges, including AI spending and fiscal policies. The conversation also touches on trade policy tensions with China and how these affect not just corporate profits but the overall strength of the U.S. dollar. Wilson remains cautiously optimistic about the potential for market recovery despite ongoing volatility.
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Economic Headwinds
- Multiple factors are impacting the economic outlook, not just tariffs.
- These include pressure on AI CapEx, fiscal spending, the stock market correction, and the Fed's decision to hold rates.
US-China Trade Tensions
- China is resisting U.S. trade demands, creating ongoing tension.
- Tariffs on China remained throughout the Biden administration, making it a contentious issue.
Foreign Investment in US Assets
- Foreign investors likely hold excessive U.S. assets.
- This, coupled with the S&P 500's large share of the global market, raises concerns.