Happy July 19, readers. Phil Rosen here, coming to you from NYC. On this date in 1969, Neil Armstrong and Buzz Aldrin went into orbit around the moon.
It's been five decades since astronauts walked in space and markets people still can't agree on what will happen next on Earth.
Today, I'm breaking down what two top firms are seeing for stocks this summer and beyond.
Let's jump in.
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1. Recession or not, stocks are going to keep falling, according to Morgan Stanley's Mike Wilson. The firm's top strategist said traders are being too optimistic about company earnings, which are likely to slow under inflationary pressures that the Fed can't seem to quell.
"Counter-trend rally may continue, but make no mistake, we don't believe this bear market is over, even if we avoid a recession — the odds of which are increasing," Wilson said in a Monday research note.
To Wilson, there's a 36% chance of a downturn in the next 12 months, thanks to rising jobless claims and declining job openings.
All of the above are going to be too much for stocks to prop up, which has left Wilson with a 3,900 forecast for the S&P 500 next year — barely a whisper away from current levels.
So Wilson's a widely respected voice on the Street, but Stifel's chief equity strategist, Barry Bannister, has just about the opposite forecast — he's predicting the S&P 500 to jump at least 9% to 4,200 this summer. Though Bannister has said before that he thinks the market has entered a secular bear market that could last for quite some time, right now, stocks are poised to gain.
That relief rally will reward investors if the economy avoids a recession over the next six to nine months, which Bannister also expects because of better-than-expected earnings power, a decline in oil prices, and cooling inflation.
In his words: "Recession fear is over-done."
2. US stock futures rise early Tuesday. Global shares, however, wavered as investors focused on upcoming central bank meetings, starting with the European Central Bank this week. Meanwhile, cryptocurrencies were down, with bitcoin trading below $22,000. Here are the latest market moves.
3. On the docket: Johnson & Johnson, Novartis AG, and Lockheed Martin Corp, all reporting.
4. Experts gave advice on managing your career in an uncertain economy. Amid stock market drops and sky-high inflation, many workers are confused and have questions about their futures. For answers, Insider spoke to eight economists, career coaches, and management experts — here's what the mixed market signals mean for your career.
5. A key gauge of the housing market just saw its steepest drop since the early days of the pandemic. Builder confidence fell sharply in July, the National Association of Home Builders said Monday. The drop comes as high inflation and rising rates are crushing mortgage demand.
6. Ether prices jumped 10% Monday as the upcoming merge into "Ethereum 2.0" has renewed enthusiasm for the world's second largest cryptocurrency. Sitting just behind bitcoin in market cap, ether traded above $1,500 early Tuesday, gaining roughly 50% over the last four weeks. A member of the Ethereum Foundation said on Twitter that the highly anticipated "merge" event could happen mid-September.
7. Russia is further distancing itself from the US dollar as it moves to trade oil with India using the local currency of the United Arab Emirates. According to a Reuters report, Moscow is looking to insulate itself from Western sanctions by trading with the UAE's dirham — and sources said more of these non-dollar deals are set to follow.
8. Investors can "get paid while they wait '' for the bear market to end, according to a chief investment strategist with $130 billion in assets under management. Making money in a bear market is never easy, but iCapital's Anastasia Amoroso says certain sectors are attractive. She broke down what investors should keep an eye on for the best opportunities right now.
9. Real estate investors sitting on the sidelines could be rewarded for their patience as home sales slow down, price cuts increase, and consumer sentiment softens. Shifting market conditions could be a boon for those sitting on cash, since there could be a rise in solid deals these next few months. Here's what you want to know.
10. Millions of workers gained a bit more authority during the Great Resignation, but the economy isn't going to let things stay that way. People have quit or switched jobs at near-record levels over the past year, but a potential recession could make things a lot worse for workers — just take a look at the relationship between wages and inflation.
Keep up with the latest markets news throughout your day by checking out The Refresh from Insider, a dynamic audio news brief from the Insider newsroom. Listen here.
Curated by Phil Rosen in New York. (Feedback or tips? Email [email protected] or tweet @philrosenn).
Edited by Max Adams (@maxradams) in New York and Hallam Bullock (@hallam_bullock) in London.