Group 1 - The U.S. labor market is significantly slowing down, with the average employment growth over the past three months dropping to only 35,000, well below last year's levels, raising concerns about the Federal Reserve potentially implementing "bad rate cuts" in response to labor market deterioration rather than inflation decline [1] - European equities are expected to face approximately a 10% correction pressure, with defensive sectors likely to benefit from this environment [1] - The decline in bond yields is anticipated to lead to downward adjustments in earnings expectations and valuation multiples, resulting in a stock market downturn amid slowing economic growth [1] Group 2 - If central banks adopt a more dovish stance due to falling inflation ("good rate cuts"), the decline in risk-free rates may not lead to a corresponding rise in risk premiums, thus supporting market growth [5] - Conversely, if rate cuts are in response to labor market and broader economic weakness ("bad rate cuts"), risk premiums are likely to rise, leading to a decrease in stock market valuations during economic slowdowns [5] - The global composite PMI new orders are projected to decline from the current 52 points to 49 points by the first quarter of next year, indicating rising risk premiums and downward adjustments in EPS expectations [5][6] Group 3 - The Stoxx 600 index is projected to face about a 10% downside, potentially dropping to 490 points by early next year, with a year-end target of 520 points [8][14] - European cyclical sectors are expected to decline relative to defensive sectors, with value stocks projected to underperform growth stocks by about 10% [8] - The pharmaceutical and food & beverage sectors are viewed positively, while the banking and capital goods sectors are expected to lag due to their recent strong performance [17]