S&P 500 RALLY TO CONTINUE ON EXPECTED FED CUTS: MORGAN STANLEY Wilson notes that the rally since April has been fundamentally driven, and while a short-term pause is possible, he remains bullish over the next 6–12 months as earnings improve and markets anticipate rate cuts. Morgan Stanley sees three main drivers: 1️⃣ Better Earnings: Earnings revisions have improved from -25% in April to -5%, justifying further gains. 2️⃣ Expected Rate Cuts: Markets are pricing in Fed easing, with Morgan Stanley forecasting seven cuts in 2026. 3️⃣ Reduced Risks: Falling oil prices and fewer policy/geopolitical risks are lowering recession concerns. This environment supports a broader market rally, starting with large-cap quality stocks and expanding further, with rate risks contained for now, according to Wilson.