What’s Ahead for Stocks this Quarter—and Where to Invest

In this bonus episode of The Morning Filter, host Dave Sekera talks with Morningstar chief economist Preston Caldwell about their stock and economic outlooks heading into the end of 2026. They recap third-quarter performance, lay out key risks for the fourth quarter, and discuss which sectors, styles and market caps look attractive versus where valuations look stretched, alongside Morningstar's analyst stock picks and its US economic outlook into 2027. The conversation also covers growth, inflation and rate expectations, the AI boom's effect on the economy, mega-cap stocks, the rise in bond yields and worsening conditions in private credit.

1. The episode argues individual stock selection is becoming increasingly important as market risks build.
2. It recaps third-quarter performance, flags key Q4 risks, and covers sectors, styles and market caps, including where valuations look stretched.
3. Caldwell and Sekera discuss expectations for economic growth, inflation and interest rates, and how the AI boom is affecting the economy.
4. Rising bond yields and worsening private-credit conditions are framed in terms of what they mean for fixed-income investors.