Morgan Stanley: Chip Stock Correction Has Entered Its Final Stage, Set to End in Mid-November

Odaily Report: Although U.S. stocks have faced increased pressure recently as enthusiasm for AI trading cools, Morgan Stanley's Chief U.S. Equity Strategist Mike Wilson remains committed to his forecast that the S&P 500 will close the year at 8,000 points. Morgan Stanley has set a tactical downside target for the S&P 500 of 7,100 to 7,200 points, slightly below the 200-day moving average. However, the firm's base-case year-end target for the S&P 500 remains at 8,000 points, and it noted that several upcoming clearing events, including the midterm elections, should mark the end of the current stock market correction.

That said, Wilson is relatively cautious on the semiconductor sector, believing that support levels for the sector could be far below current levels, while also noting that selling pressure on semiconductor stocks may ease somewhat next month.