Bank says geopolitical risk rarely derails markets and oil prices would need to double to threaten its positive outlook Morgan Stanley, the US investment bank, has reaffirmed its bullish stance on American equities despite fresh tensions in Iran and across the Middle East, arguing that history shows such events rarely produce sustained sell-offs. Analysing 22 geopolitical events since the Korean War in 1950, the bank's equity strategy team found the S&P 500, the main US stock market index, has returned 2%, 6% and 8% on average over one, six and twelve months following such episodes.
News Corporation (NWSA) Presents at Morgan Stanley Technology, Media & Telecom Conference 2026 Transcript
Commerce.com, Inc. (CMRC) Presents at Morgan Stanley Technology, Media & Telecom Conference 2026 Transcript
Just as I predicted, Morgan Stanley Direct Lending Fund has cut its dividend. Yet, as the cut was minor (only 10%) and the recent SaaS-driven selloff has pushed the BDC into an even deeper discount zone, we can still buy MSDL at ~13.5% yield. Apart from the cut, MSDL has released several other important fundamental data points in its Q4 report, which support a long-term bull case here.
JP Morgan has upgraded two of Europe's largest oil companies and identified its preferred stocks to play a potential surge in oil prices, as full-scale military strikes in the Middle East transform what had been a theoretical supply risk into reality. The US investment bank's European oil and gas team upgraded Eni, the Italian energy major, by two notches to overweight and raised TotalEnergies, the French oil giant, to 'overweight' from 'neutral', while reiterating 'overweight' ratings on Shell PLC (LSE:SHEL, NYSE:SHEL) and Galp, the Portuguese energy company.
Morgan Stanley preferreds, MS.PR.A (floating) and MS.PR.E (fixed), are compared for coupon structure and investor suitability. MS demonstrates strong dividend safety with a 27.5x income coverage and a robust 10.4x common equity to preferred par ratio. MS.PR.A offers a 5.83% yield with a floating coupon (4% floor), while MS.PR.E yields 7.13% at a fixed 7.125% coupon.
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MS had $385.9B average liquidity at 2025-end, backing dividends (+8% to $1.00) and buybacks with $17.4B still authorized under its $20B plan.
MS looks like the sturdier way to play the M&A upcycle, pairing rebounding IB fees with strong trading and a wealth platform that boosts durability.
Kinder Morgan remains a solid buy-and-hold pick, supported by 96% fee-based or hedged cash flows and a $10 billion project backlog. KMI's Q4 2025 adjusted EBITDA rose 10% YoY, driven by LNG exports and surging natural gas demand, especially from the Haynesville system. With a 3.6% dividend yield, a 44% OCF payout ratio, and a BBB+/Baa2 balance sheet, KMI offers steady income and growth potential.
Morgan Stanley is upgraded to "buy on weakness" due to robust ROTCE targets and accelerating earnings momentum. MS delivered strong Q4 2025 results, with net interest income up double digits and ROTCE reaching 21.6%. The Series E preferred shares offer a 7.125% yield, and remain well covered, but carry elevated call risk if rates fall.
When one of Wall Street's most powerful banks calls a stock “the most under-owned megacap,” it's worth paying attention.