Morgan Stanley's Wilson Predicts S&P 500 Pullback to 7,100 Before Rebound to 8,000

Morgan Stanley chief U.S. equity strategist Mike Wilson forecasts the S&P 500 may decline roughly 9% to around 7,100 before rebounding toward 8,000. Wilson advises investors to treat the anticipated midterm election pullback as a buying opportunity rather than an end to the bull market. Potential near-term headwinds include elevated political uncertainty, tightening liquidity, and scrutiny surrounding artificial intelligence capital spending. Supporting a subsequent recovery, historical data shows U.S. equities gained across six- and 12-month periods following every midterm election since 1950, while capital-raising pressures are expected to ease.