Any recovery for US equities — which last week sank into correction territory before recovering some lost ground over the ensuing two sessions — isn’t likely to lead to new record highs. Not yet.

That’s according to Morgan Stanley’s Mike Wilson, who on Monday reiterated that the growth-friendly aspects of Donald Trump’s policy platform may be a second-half story, leaving H1 to the vagaries of the trade war and Elon Musk’s federal payrolls purge.

Somewhat amusingly, Wilson said Trump’s explicit rebuke of the “Trump put” was the proximate cause of stocks’ capitulation last week. “President Trump has recently indicated that he is not focused on the stock market in the near-term as a barometer of his policies and agenda,” Wilson said. “Perhaps more than anything else, this is what led to the most recent technical breakdown.”

By “technical breakdown,” Wilson meant multiple key benchmarks breaching their 200-day moving averages, but also “many” individual names trading down 20% and small-caps falling below their 200-week moving average “for the first time since the 2022-23 bear market.” That kind of damage, Wilson warned, “will take time to repair.”

It’s not that he doesn’t see scope for tradeable rallies. In fact, he does, particularly in light of a tailwind from a weaker dollar, lower yields, cleaner positioning and a less onerous seasonal going forward. 5500 SPX, he said, should provide some provisional support.

And yet, if the question’s “whether such a rally is likely to extend into something more durable, the short answer is, probably not,” Wilson said.

The figure above’s familiar. Revisions breadth’s rolling over, and the implication from the demonstrable disconnect circled in red (my annotation) is that equities may still have some “catching down” to do.

“We firmly believe that earnings revisions is the most important variable, and while we could see some seasonal strength/stabilization in revisions, we believe it will take a few quarters for this factor to resume a positive uptrend,” Wilson went on.

The bottom line from Mike on Monday was that the headwinds to growth (or at least to the growth outlook) are strong currently, and the “goodies” from Trump’s agenda are unlikely to be pulled forward fast enough to offset the drag from tariffs, fragile consumer sentiment and so on.

Meanwhile, Goldman’s David Kostin cut his S&P target for the year to 6200 from 6500, trimming both the bank’s earnings growth estimates and valuation forecast in the process. As the table on the right, below, shows, Kostin’s now below both bottom-up consensus and his top-down peers on EPS.

“We revised our 2025 and 2026 earnings to $262 and $280 respectively, reflecting growth of 7% in both 2025 and 2026 versus 9% and 7% previously,” Kostin wrote, adding that Goldman “now expect[s] the S&P 500 will trade at a forward P/E of 20.6 by year-end vs. 21.5 previously.”

So, is there any good news here? Beyond Wilson’s contention that 5500’s a tradeable floor I mean? Not really. Even if the Fed steps in with support, verbal or otherwise, the read-through would be unfavorable for risk given that we’re now squarely in a “bad news is bad news” regime.

“While the Trump put apparently doesn’t exist, the Fed put is alive and well, in our view,” Wilson wrote. “However, that will likely require conditions to worsen either for growth or in the credit/funding markets, neither of which would be equity-positive, initially.”