摩根士丹利的迈克尔·威尔逊（Michael Wilson）是一位坚定的美股空头。他表示，Source: Golden Ten Data
As interest rates will remain high for a longer period of time, can US stocks continue to rise at the beginning of the year? Two of Wall Street's most famous US stock strategists sang a drama against Taiwan.
Faced with the prospect that interest rates will remain high for a longer period of time, the two most famous US stock strategists on Wall Street disagree about whether the stock market can continue this year's gains.
Michael Wilson (Michael Wilson) of Morgan Stanley is a staunch US stock short. He said,The negative correlation between real interest rates and stock returns has been further strengthenedThis shows that interest rates are once again a determining factor in stock market performance. However, Bank of America's Savita Subramanian (Savita Subramanian) believes that even if interest rates remain high, the stock market can still thrive.
Wilson wrote in a report to clients on October 1, “The stock market has experienced significant changes since mid-July.” He added that the decline in US stocks after the Fed's policy meeting last month showedInvestors are “beginning” to believe that “interest rates will remain high for a longer period of time.”
Wilson correctly predicted a sharp decline in the stock market in 2022, but failed to predict this year's rise. The weakness in US stocks since this summer may prove his correctness. The S&P 500 index fell continuously in August and September, partly taking back this year's double-digit gains.
By contrast, Sabramania believes that even if borrowing costs remain high, there is reason to be bullish on the stock market. First, the proportion of large capitalization companies shrunk to small-cap stocks is 50% higher than in the opposite case. This is the opposite of what happened in previous decades, which indicatesHigher capital costs have “weeded out the weak,” leaving the S&P 500 in “good shape”.
Furthermore, she pointed out that between 1985 and 2005,Despite a real interest rate of 3.5%, the S&P 500 still has an annualized return of 15%.
After missing the gains of the first half of 2023, Sabramanian is one of the first analysts among many sell-side strategists to be optimistic about US stocks. She has raised her year-end forecast for the S&P 500 index twice since May, and correctly predicted a sharp decline in the stock market last year.
On Monday, higher bond yields further dampened interest in risky assets, and U.S. stocks continued to decline. U.S. stocks have experienced weeks of sell-off due to fears that restrictive monetary policies will have a negative impact on economic growth. On Friday, US stocks ended their worst month of performance this year.
The recent stock market turmoil has given some bearers a respite, and their pessimistic predictions for the first half of the year have not been confirmed. However, optimists see recent losses in US stocks as a normal seasonal decline, and they point outStock “discounts” and the upcoming earnings season are reasons to buy and prepare for a potential year-end rebound.
Goldman Sachs Group said on Monday that while profit expectations are still rising, the wave of sell-offs has led to historically low valuations of technology stocks, which indicates that these stocks may beThe blowout bullish market from earlier this year has resumed.
Bank of America said the recent slump among investors is another reason to buy stocks. Its seller-side indicator (a reverse sentiment indicator that tracks seller-side strategist stock allocation recommendations) remained at a level that historically predicted that US stocks would rise 95% of the time in September. The bank said on Monday that “Wall Street is pessimistic, lacks faith, and is in trouble,” and suggested “buy stocks and sell bonds.”
edit/lambor
