Morgan Stanley strategists led by Michael Wilson say a sharp valuation reset in U.S. equities since early summer has created buying opportunities in economically sensitive sectors with intact fundamentals. The team highlighted capital goods as especially attractive, with the largest upward revisions to profit forecasts. The U.S. rally has cooled since mid‑August as rising bond yields have offset gains from a strong earnings season. Companies start reporting Q3 results in the coming weeks; Bloomb

Morgan Stanley strategists led by Michael Wilson say a sharp valuation reset in U.S. equities since early summer has created buying opportunities in economically sensitive sectors with intact fundamentals. The team highlighted capital goods as especially attractive, with the largest upward revisions to profit forecasts. The U.S. rally has cooled since mid‑August as rising bond yields have offset gains from a strong earnings season. Companies start reporting Q3 results in the coming weeks; Bloomberg Intelligence shows analysts expect S&P 500 Q3 earnings +25% YoY after a +34% rise in Q2. Earnings momentum is being driven by AI demand, record cloud capex from major cloud providers and a resilient macro backdrop.