New York Post·2025-11-04 15:16Market Overview - US stocks experienced a decline, with the Dow Jones Industrial Average dropping 450 points (1%), and the S&P 500 and Nasdaq falling 1.2% and 1.7%, respectively [1][3] - Concerns about a market correction were raised by the CEOs of Goldman Sachs and Morgan Stanley, who indicated that a 10 to 20% drawdown in equity markets is likely within the next 12 to 24 months [1][3] CEO Insights - Goldman Sachs CEO David Solomon noted that market pullbacks are typical in long-term bull markets, comparing the current situation of AI stocks to the dot-com bubble of the 1990s [3][4] - Solomon emphasized that a 10 to 15% drawdown is common even during positive market cycles and does not alter fundamental capital allocation beliefs [4] - Morgan Stanley CEO Ted Pick echoed this sentiment, suggesting that investors should view periodic pullbacks as healthy for the market [4][9] AI Stocks Performance - Shares of Palantir fell 9.7% despite a positive earnings report, as analysts questioned the sustainability of its valuation, which has surged approximately 175% this year [5][7] - Other AI stocks, including Oracle, AMD, Nvidia, and Amazon, also saw declines of 2.4%, 3.6%, 2.5%, and 1%, respectively [7][12] Economic Context - Investor anxiety is compounded by concerns over potential economic repercussions from the ongoing government shutdown, which has reached a record duration of 35 days [9] - Federal Reserve Chair Jerome Powell, along with other financial leaders, has warned about inflated stock valuations [10] Regional Focus - Both Goldman Sachs and Morgan Stanley maintain a bullish outlook on Asia, citing a recent trade deal between the US and China as a positive factor [11] - Morgan Stanley highlighted growth potential in China's AI, electric vehicle, and biotech sectors, viewing them as part of a broader narrative for global Asia [11]