Wells Fargo’s Harvey warns S&P 500 set for 10% correction

“In our view, equity downside will be driven by worsening economic conditions, a function of aggressive monetary policy, potential capital and liquidity issues catalysed by the bank crisis and a consumer that is increasingly reliant upon credit to sustain spending,” Harvey and his team of strategists said in a note to clients. — Reuters

NEW YORK: The resilience of US equities this year will be short-lived, with a worsening economic picture likely sending the market down in the coming months, according to Chris Harvey at Wells Fargo and Co. The bank’s head of equity strategy expects the S&P 500 to suffer a 10% correction in the next three to six months.

That would take the American stock benchmark to around 3,700, which is near the November lows.