Morgan Stanley: Whether the Fed cuts interest rates by 25 or 50 basis points, the market can trade in a risk-off tone

"If employment data weakens from here, the market is likely to trade in a risk-off tone, regardless of whether the Fed's first rate cut is 25 basis points or 50 basis points," Morgan Stanley's Mike Wilson wrote in a report. Wilson is one of the most prominent bears before mid-2024. On the other hand, he said that if employment conditions improve, the Fed will cut rates by 25 basis points by mid-2025, which could further support U.S. stock valuations. (Jinshi)