MS · News · 20261020N

Market Correction Outlook

MORGAN STANLEY · 2026-10-20 · Importance 17 · Surprise 24

Morgan Stanley strategists said the U.S. equity-market correction is in its “final innings,” but forecast another two to three weeks of volatility before a stronger finish to 2026. Mike Wilson projected the S&P 500 could reach 8,500 by mid-2027, while Joe Amato cited an 8,300 target by May 2027. The strategists said the next phase of the AI rally should favor companies converting AI into revenue and profit rather than infrastructure providers, while widening credit spreads in parts of the AI sector are a key risk.

Key facts

• Joe Amato, Morgan Stanley's investment chief, said the stock market correction is in its 'final innings' but expects two to three more weeks of volatility and forecasts the S&P 500 could reach 8,300 by May 2027 and 8,500 by mid-2027. source
• Mike Wilson, Morgan Stanley's CIO and Chief U.S. Equity Strategist, said the market correction is nearing its end. source