[Quality factor new high guidance layout Morgan Stanley Wilson: The end of the stock market correction is coming] On October 19, Michael Wilson, chief equity strategist of Morgan Stanley (MS.US), sent a clear signal that the internal adjustment in the stock market that has lasted for several months is coming to an end, and investors should be prepared to increase risk exposure. This judgment is based on the triple signals that the quality factor has broken through new highs, earnings revisions have become more differentiated, and valuations have been significantly digested, providing the market with a rare layout window. The differentiation pattern is a typical characteristic of the market's transition from early cycle to mid-cycle. Wilson said, "We recommend that investors prepare for either a quick recovery or a more gradual downward pressure extending into November, because in our view, it will be a time to add risk (positioning) rather than avoid risk." At the same time, Goldman Sachs (GS.US) strategists noted that investor positions are becoming defensive, and JPMorgan Chase (JPM.US) believes that stabilizing bond yields will form "important support" for stocks. The quality factor breaks through, and the mid-cycle transition signal is clear. Morgan Stanley's (MS.US) Quality Factor Composite Index has risen to a new 52-week high, gaining about 6% since mid-August, while the equal-weighted S&P 500 index has fallen nearly 4% during the same period. Wilson believes that this divergence is a clear confirmation of the market's switch from being led by low-quality stocks in the early cycle to being led by high-quality stocks in the mid-cycle. Earnings revision data further strengthened this judgment. The earnings revision breadth gap between high-quality and low-quality stocks has widened to about 10%, the second highest level since 2010. Historical data shows that when the gap is at its historically highest quintile, high-quality stocks outperform low-quality stocks by an average of about 8% over the subsequent 12 months, while the average excess return across all periods is only about 1%.