Morgan Stanley and JP Morgan stand behind US stocks: strong corporate profit outlook, outflow trend will not last

Notice that some Wall Street top strategists say that the US stock market will not remain unpopular in the long term, given the strong economic growth and profit prospects of CKH HOLDINGS. Over the years, the S&P 500 index has performed well, but by 2025, it will lag behind its international peers due to uncertainty surrounding US President Trump's tariffs and immigration policies, as well as high valuations causing investors to hesitate. Chinese AI startup DeepSeek has also raised concerns among investors about the US losing its position as a leader in artificial intelligence. Morgan Stanley strategist Michael Wilson stated that he expects capital to return to the US stock market, calling the S&P 500 index the "highest quality index" with the "best profit growth prospects". Wilson had previously been bearish on the US stock market until the middle of 2024. This year, the US stock market has lagged behind international stock markets. Wilson wrote in a report, "It is too early to conclude that the trend of exiting the US is sustainable now." The stocks of the tech giants known as the "Big Seven" have raised the most investor concern, with worries that since the low point at the end of 2022, these tech giants have driven the rebound on Wall Street and now their stock prices have become too expensive. The profit growth of these tech giants will also slow down after reaching its peak in 2023. The Nasdaq 100 Index, which has a high proportion of tech stocks, fell by 2.1% last Friday. So far this year, the S&P 500 index has only risen by about 2%, while the Euro Stoxx 600 index has risen by 9%, and the Nasdaq Golden Dragon China index has risen by 18%. In contrast, the Big Seven have fallen by 1.9%. JPMorgan strategist Mislav Mattiaca stated that the outlook for large tech stocks is gloomier, indeed posing a "major obstacle" to the US stock market regaining its outstanding performance. However, he added that US profit growth needs to be lower than in other parts of the world to support a completely bearish view. Mattiaca wrote in a report, "We do not recommend reducing US stocks, as we see a large profit gap between the US and other countries, and tariff escalation is also an uncertain factor."