Do you think the bottom was reached?
Prepare for more losses, warns Mike Wilson, Morgan Stanley’s chief U.S. equity strategist and chief investment officer.
Speaking in an interview with CNBC on Tuesday, Wilson warned that Corporate America is about to unleash downward earnings revisions in the coming months that will hammer stocks.
The S&P 500 could slump as much as 24 percent in early 2023 from its current level of 3,957, Wilson forecast.
“It’s the path. I mean nobody cares about what’s going to happen in 12 months. They need to deal with the next three to six months,” he said. “That’s where we actually think there’s a significant downside. So, while 3,900 sounds like a really boring six months. No… it’s going to be a wild ride.”
“You should expect an S&P between 3,000 and 3,300 sometime in probably the first four months of the year,” Wilson added. “That’s when we think the deacceleration on the revisions on the earnings side will kind of reach its crescendo.”
Put simply, “the bear market is not over.”
This comes after the latest Federal Reserve money-supply data show that money supply growth is the lowest it has been since before the coronavirus pandemic.
Winter is coming.
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