Mike Wilson

Mike Wilson, Chief U.S. equity strategist at Morgan Stanley, and Mohamed El-Erian, Chief economic advisor at Allianz, dive into the recent easing of global market selloffs. They analyze the rebound in U.S. stocks and the cautious optimism around tax cuts affecting earnings. The duo discusses the balance between navigating uncertainties and strategic investments in a volatile climate while considering potential Federal Reserve actions. Insights on moving from U.S. equities to foreign assets are shared, revealing the shifting dynamics of today's financial landscape.

Mike Wilson, Chief Investment Officer at Morgan Stanley, returns to share his insights on market trends. He discusses the surprising resilience of the market and the vital role of earnings forecasts and liquidity in shaping investment strategies. The conversation dives into the rise of passive investing, the impact of international monetary policies, and how various sectors may respond to economic changes. Wilson also touches on the potential of AI and the implications of currency fluctuations for multinationals as we look toward the economic landscape ahead.

Neil Dutta, head of US Economic Research at Renaissance Macro Research, discusses rising bond yields and the likelihood of a recession in 2025. Priya Misra of JP Morgan Asset Management offers insights on the potential for a US soft landing and peak rates in fixed income markets. Mike Wilson, Morgan Stanley’s Chief US Equity Strategist, analyzes the resilience of the equity market, contemplating where traders might see volatility in the upcoming year. Together, they navigate the complexities of the economic outlook amid changing financial landscapes.

Mike Wilson, Chief Investment Officer at Morgan Stanley, discusses market performance, inflation risks, fiscal policies, labor market data, and global elections' impacts on the economy with Guy Adami, Danny Moses, and Dan Nathan. They touch on sectors like tech, industrials, and energy, and explore the influence of bond market movements and central bank stability on investor sentiment.

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.

Mike Wilson, Chief US Equity Strategist at Morgan Stanley, shares his insights on market dynamics during turbulent times. He discusses the S&P's significant overselling and the role of Federal Reserve policies in shaping investor confidence. Mike highlights the potential effects of tax cuts and deregulation on earnings, while also exploring a 'rolling recovery' in low-quality stocks. Additionally, he delves into the influence of currency fluctuations on tech stocks and strategic investment opportunities amid market volatility.

Mike Wilson, Morgan Stanley's Chief US Equity Strategist, shares his expert insights on market predictions and Scott Bessent's nomination. He delves into navigating the evolving economic landscape post-election, discussing strategic recommendations amid inflation and political pressures. The conversation highlights the changing tech investment scene, with a focus on AI's role in market shifts. Wilson balances optimism about future earnings growth against concerns of high valuations and geopolitical risks, stressing the need for objectivity in economic decisions.

Mike Wilson, market expert and analyst from Morgan Stanley, joins the hosts to discuss the November stock market rally, late-cycle behavior, earnings, the bond market, the worst possible scenario for stocks, the single biggest risk for 2024, what consensus could get wrong next year, sentiment indicators, stock market concentration, M&A, and the appeal of U.S. markets as a safe haven. Later, they discuss the Elon Musk DealBook interview, the meteoric rise in the S&P 500, GM's $10B buyback, M&A, the energy space, JPMorgan survey, LME wins High Court ruling, and Danny's NFL picks.

While there seemed to be a consensus that U.S. Equities will struggle through the first half of the year before finishing strong, views are now varying on the degree and timing of a potential recession.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, January 23rd at 11am in New York. So let's get after it. Coming into this year, the number one investor concern was that everyone seemed to have the same outlook for U.S. equities - a tough first half followed by a strong finish. Views varied on the degree of the drawdown expected and magnitude of the rebound, but a majority expected a U.S. recession to begin sooner rather than later. Fast forward just a few weeks and the consensus view has shifted materially, particularly as it relates to the recession view. More specifically, while more investors are starting to entertain a soft landing for the economy, many others have pushed out the timing of a recession to the second half of the year. This change is due in part to China's reopening gaining steam and the sharp decline in European natural gas prices. While these are valid considerations for investors to modify their views, we think that price action has been the main influence. The rally this year has been led by low quality and heavily shorted stocks. It's also witnessed a strong move in cyclical stocks relative to defensive ones. This cyclical rotation in particular is convincing investors they are missing the bottom and they must reposition. Truth be told, it has been a powerful shift, but we also recognize that bear markets have a way of fooling everyone before they're done. The final stages of the bear are always the trickiest. In bear markets like last year, when just about everyone loses money, Investors lose confidence. They question their process as the price action and cross-currents in the data create a hall of mirrors. This hall of mirrors only increases the confusion. This is exactly the time one must trust their own work and ignore the noise. Suffice it to say we're not biting on this recent rally because our work in process is so convincingly bearish on earnings. Importantly, our call on earnings is not predicated on the timing of a recession or even if one occurs this year. Our work continues to show further erosion with the gap between our model and the forward estimates as wide as it's ever been. Could our model be wrong? Of course, but given its track record, we don't think it will be wrong directionally, particularly given the collection of leading series and models we published that point to a similar outcome. This is simply a matter of timing and magnitude, and we think the timing is imminent. We find the shift in investor tone helpful for our call for new lows in the S&P 500, which will finish this bear market later this quarter or early in the second quarter. Getting more specific, our forecasts are predicated on margin disappointment and the evidence in that regard is increasing. When costs are growing faster than sales, margins erode. This is very typical during any unexpected revenue slowdown. Recessions in particular lead to significant negative operating leverage for that very reason. In other words, sales fall off quickly and unexpectedly, while costs remain sticky in the short term. Inventory bloating, less productive headcount and other issues are the primary culprits. This is exactly what is happening in many industries already, and this is without a recession. It's also right in line with our forecast and the thesis that companies would regret adding costs so aggressively a year ago when sales and demand were running so far above trend. Bottom line, after a very challenging 2022, many investors are still bearish fundamentally, but are questioning whether negative fundamentals have already been priced into stocks. Our view has not changed as we expect the path and earnings in the U.S. to disappoint the consensus, expectations and current valuations. In fact, we welcome the change in sentiment positioning over the past few weeks as a necessary development for the last stage of this bear market to play out. Bear markets are like a hall of mirrors designed to confuse investors and take their money. We advise staying focused on the fundamentals and ignoring the false signals and misleading reflections. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.

Mike Wilson, Chief US Equity Strategist at Morgan Stanley, shares his insights on market volatility and the potential impact of upcoming tariffs. He discusses how these tariffs could push the S&P 500 below 5,500 in the short term. Despite this, he remains optimistic about the overall market for the year. Wilson delves into the transition from Wall Street to Main Street, analyzing how economic shifts affect everyday Americans. He highlights the need for cautious investment in high-quality companies amid trade uncertainties and stagflation concerns.