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Michael Zezas, Morgan Stanley’s deputy head of global research, spoke on Bloomberg TV about the outlook for “Magnificent Seven” stocks. He noted these mega-caps are facing pressure as interest rates stay high, reducing the appeal of their future earnings. While the stocks remain fundamentally strong, their high valuations pose a risk.
Zezas also discussed US mid- and small-caps, suggesting they could outperform if rates stabilize or fall, as they are more sensitive to domestic economic conditions. He advises investors to look beyond the mega-caps to find opportunities in a market that could see broader participation.
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