Opinion: Relief of tariff pressure opens up room for the Fed to cut interest rates, and the risk of recession has "significantly decreased"

Mars Finance News, on May 13, Morgan Stanley's Chief Investment Officer Wilson (Mike Wilson) believes that the historic sell-off previously triggered by Trump has come to an end. He reiterated his prediction that the S&P 500 index will reach 6,500 points by the end of the year (representing a 12% increase from current levels) and pointed out that reduced tariff pressure opens up space for the Federal Reserve to cut interest rates, which will directly benefit risk assets such as stocks. Wilson stated, "If tariff threats weaken, the Federal Reserve can rebalance its dual mandate. Although growth prospects are slightly optimistic, the policy balance may lean more towards stimulating the economy rather than curbing inflation." He particularly emphasized that with the weakening of the US dollar and progress in US-China negotiations, the risk of economic recession has "significantly decreased," and corporate earnings expectations have improved accordingly: "From a rating adjustment perspective, performance in the second half of the year is likely to exceed expectations, given how terrible the first half was."