
Morgan Stanley Flags Crowded Lira Trade as Currency Hits Record
The guidance follows the Turkish central bank 's 300 basis-point rate cut on Thursday, which marked a return to monetary easing and sent the lira sliding to a new all-time low against the dollar in thin late-session trading.
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Morgan Stanley Boosts Meta Target to $850—Here's Why
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Yahoo
an hour ago
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One key reason a slowing economy isn't shaking stock market bulls: Morning Brief
Last week, fears over the US economy slowing more than initially thought took center focus as the major indexes experienced the worst single-day drop of the summer. That was the headline takeaway from the busiest week of data releases slated for the summer of 2025. But underneath the surface, there are still plenty of reasons to feel confident in the path higher for the S&P 500 (^GSPC), according to Wall Street strategists — a confidence that seemed to roar back on Monday as the S&P 500 jumped 1.5%. Sign up for the Yahoo Finance Morning Brief By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy Besides the dour jobs report, investors also learned that the S&P 500 is pacing for year-over-year earnings growth of 10.3%, well above the 5% expected entering the reporting period, per FactSet data. On top of that, we heard Big Tech giants say they're set to spend another $364 billion in AI investments during 2026, and third quarter earnings estimates for the S&P 500 weren't slashed during the first month of the quarter for the first time in over a year. In other words, while the US economic growth story is taking hits, the fundamental driver of the AI-driven bull market is absolutely cooking. That made Mike Wilson and the equity strategy team at Morgan Stanley declare "we're buyers of pullbacks," and that the team is bullish over the next 12 months. "While there's risk in the near-term, we are gaining confidence in our 12-month bullish view fueled by better earnings/cash flow growth," Wilson wrote. "The drivers include positive operating leverage, AI adoption, dollar weakness, cash tax savings from the [One Big Beautiful Bill], easy growth comparisons, and pent up demand for many sectors in the market." BlackRock's Investment Institute, led by Jean Boivin, wrote in a weekly market commentary note that there is a clear "tug-of-war" between the economic drag of tariffs and US corporate resilience driven by AI. They, too, are taking their signal from the latter. "Questions remain about who will pay for tariffs," Boivin's team wrote. "Early signs indicate a mix of consumers and companies. We think US corporate strength could cushion the blow and stay overweight the AI theme and U.S. stocks." In a research note summing up earnings reports seen from more than two-thirds of S&P 500 companies this quarter, Bank of America Securities head of US equity and quantitative strategy Savita Subramanian wrote that the "AI arms race is alive and well." To Subramanian, the focus on AI growth continuing to inflect higher isn't all about tech stocks either. It could be a tailwind for a broadening of the stock market rally and support US economic growth. "Increased power usage from AI and the physical build out of data centers should also lead to more demand for electrification, construction, utilities, commodities, etc, ultimately creating more jobs." Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Morgan Stanley Upholds Overweight for Microsoft (MSFT), Lifts PT to $582
Microsoft Corporation (NASDAQ:MSFT) is one of the . On July 31, Morgan Stanley analyst Keith Weiss raised the price target on the stock to $582.00 (from $530.00) while maintaining an 'Overweight' rating. The rating affirmation by Morgan Stanley is backed by durable margins at Microsoft, with the company ending FY25 with operating margins at 45.6%. The firm also noted how capital expenditures have been aggressive, and cloud revenue contribution has been growing. However, analysis at Morgan Stanley reveals that gross margins are currently 100 basis points higher than FY20 levels. 'There are multiple components of this improving margin equation including: 1) while mixing down with lower-margin business like Azure, the margins within these businesses are improving as Microsoft finds ways to run them more efficiently (see the 90% token growth comment above); 2) extending the useful life of the infrastructure given an expansive portfolio of solutions with varying resource needs; and 3) optimizing lower-growth areas to fund the higher-growth portions of the portfolio – More Personal Computing revenues grew 9% YoY, while operating income grew 33% YoY." Is it Still a Wise Move to Buy Microsoft (MSFT) Shares? "With headcount roughly flat exiting FY25 and management guiding to flat operating margins in FY26, this trend looks poised to continue. With Productivity and Business Processes growing 14% cc and Intelligent Cloud growing 25% cc, we are likely far from seeing a 'fully optimized' Microsoft.' Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements. While we acknowledge the potential of MSFT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data