J.P.Morgan, Morgan Stanley urge buying the dip as US earnings stay resilient

 Wall Street brokerages JPMorgan and Morgan Stanley said recent market weakness has created opportunities for long-term investors, arguing that resilient corporate earnings growth could cushion the fallout from the Middle East ​conflict.

Morgan ​Stanley strategists led by Michael Wilson said the recent selloff in the U.S. S&P 500 looked more like a ‌correction ⁠than the start of a prolonged downturn, and attributed the support to improving earnings growth and healthier valuations.

Earnings expectations have continued to increase despite the conflict. The earnings growth rate estimate for the S&P 500 stood at 13.9% for the first quarter of 2026 as of April 10, compared with estimates of ​a 12.7% rise before ​the war broke ⁠out, per LSEG I/B/E/S data.

Goldman Sachs struck a similar tone in early March, warning of near-term "correction risks" to global stocks but saying there was little room for a bear market.

JPMorgan also noted that the valuation premium for the so-called "Magnificent Seven" cohort of stocks had narrowed sharply, with ⁠their forward ​price-to-earnings ratio for the group falling to 1.2x the ​S&P 500 from 1.7x.

[https://www.reuters.com/business/finance/jpmorgan-morgan-stanley-urge-buying-dip-us-earnings-stay-resilient-2026-04-13/](https://www.reuters.com/business/finance/jpmorgan-morgan-stanley-urge-buying-dip-us-earnings-stay-resilient-2026-04-13/)