The S&P 500 is priced for perfection and could plunge 25% if problems crop up, Mike Wilson says. Morgan Stanley’s stock chief says the outlook for company earnings and the economy is pretty grim. Investors have piled into Big Tech to ride out the storm, but they may still feel pain, Wilson says.
Financial News
Stock futures are little changed as Wall Street shifts focus back to path of interest rates

Renewed investor worries sprang up Wednesday over the threat of future interest rate hikes, sparked by stronger-than-expected economic data and price reports.
Detroit UAW workers strike threat tests Biden’s plan to win union votes
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U.S. President Joe Biden’s strategy of backing politically crucial unions while avoiding strikes that cripple the economy has hit a bump in Detroit.
$1 trillion of debt to face ‘day of reckoning’: Bank of America
There’s around $1 trillion of private debt that’s headed for potential trouble, Bank of America warned. Most of that debt has been created by below-investment grade companies through high yield loans or bonds. Around $400 billion assets are considered to be in “pre-distress,” while $150 billion assets are “deeply distressed.”
Extreme bubble in stocks ‘will end in tears’, risk of 64% crash: Hussman
John Hussman, an asset-bubble expert, forecasts the ongoing rally in US stocks will “end in tears.” The S&P 500 risks a 64% collapse given extreme valuations and “unfavourable market internals,” he said. Here are the long-time market bear’s six most striking quotes from a recent note.
What Could Knock Stocks Back Into a Bear Market

Even though the stock market has climbed its way back into bull-market territory, don’t forget: Several factors could easily send it lower. At just over 4300, the S&P 500 is now about 20% above 3577, the lowest closing price seen in the recent bear market. That level, reached in early October, left stocks 25% below the record high hit in early 2022. A gain of 20% from a low technically marks the start of a new bull market, which matches a recent surge of optimism. A Barron’s cover story this