Morgan Stanley strategist Michael Wilson said that the market's expectations for corporate earnings are overestimated, and US stocks may face a sharp decline.
Given the events of the past few weeks, Wilson believed that corporate earnings guidance was increasingly unrealistic and stocks could face a sharp downgrade ahead of earnings numbers, said Wilson in a research note on Monday.
Wilson pointed out that financial stocks and retail stocks have begun to be repriced, and valuations have fallen to the point where they can be bought again.
Still, Wilson did not expect stocks to remain low for long.