Morgan Stanley: The risk of a significant correction in the U.S. stock market has surged, with the 10-year U.S. Treasury yield rising above 4.5%

Morgan Stanley's defined "warning line" for the U.S. stock market has been breached. The bank's Chief Investment Officer and well-known Wall Street bull, Michael Wilson, warned that if U.S. Treasury yields continue to rise and volatility increases, the U.S. stock market will face "the first significant pullback since the end of March."

Michael Wilson stated, "If long-term yields rise along with bond volatility, we expect the stock market to experience its first significant pullback since the bottom in late March." Previously, Morgan Stanley marked a 10-year U.S. Treasury yield of 4.5% as "the critical point where yields may pose a more obvious resistance to stock market valuations."