Morgan Stanley’s Mike Wilson Says Buy US Stock Dips After Moody’s Cut скачать в хорошем качестве

Morgan Stanley’s Mike Wilson Says Buy US Stock Dips After Moody’s Cut

Investors should buy any dips in US stocks fueled by Friday’s credit rating cut, as the trade truce with China has reduced the odds of a recession, according to Morgan Stanley’s Michael Wilson. The strategist sees a greater chance of a pullback in equities after the downgrade by Moody’s Ratings pushed 10-year bond yields above the key 4.5% level. However, “we would be buyers of such a dip,” Wilson wrote in a note. S&P 500 futures slid 1.2% on Monday following the debt downgrade, which Moody’s said was in response to a ballooning budget deficit that showed little sign of narrowing. The move has reignited worries about whether US assets are still popular at a time of lingering global trade uncertainty. Moody’s is the last of the major US rating agencies to issue such a downgrade. Fitch Ratings and S&P Global Ratings stripped US debt of its top rating in 2023 and 2011, respectively. The benchmark US stock index has trailed international peers this year and only recovered its 2025 declines last week following the temporary trade deal between Washington and Beijing. In an encouraging sign, Wilson said the corporate earnings season seemed to have ended with no major impact from the uncertainty over tariffs. A recent pickup in profit upgrades also bodes well for further equity gains, even if the coming months show slightly weaker trade data, he said. Blink and you missed it. The historic downgrade of US sovereign debt announced Friday night only momentarily interrupted momentum. The S&P 500 rose 0.09% for its sixth consecutive daily gain, while bonds had a good day despite Moody’s negative judgment. After an initial selloff, the 10-year Treasury yield closed the day at 4.44%, 3.2 basis points lower for the day. Treasury Secretary Scott Bessent’s dismissal of the agency as a “lagging indicator” of US fiscal policy looks to have been right. It had no significant short-term impact.  That said, Moody’s nailed a broader truth — that US debt has surged. Germany’s post-Global Financial Crisis “debt brake” left it with space to borrow now. American debt kept rising and takes a bigger share of the economy than China’s. Even though Treasury debt is the linchpin of the world financial system, it is now lower-rated than 10 other countries: Australia, Canada, Denmark, Germany, Netherlands, New Zealand, Norway, Singapore, Sweden, and Switzerland. So there are alternatives, even if they’re nowhere near deep enough to soak up all the money in Treasuries. As Europe embarks on extra borrowing to bolster defense — at a stronger rating than Treasuries — there could be more triple-A bonds available to buy -------- Subscribe to Bloomberg Live on YouTube:    / @bloomberg_live