Andrew Slimmon of Morgan Stanley Investment Management said the ongoing tech sell-off is healthy and good for the markets.
This perspective suggests that the recent volatility is not a sign of a crash, but rather a necessary correction of overvalued assets. By lowering prices to sustainable levels, the market may be positioning itself for a more stable long-term ascent.
Slimmon, a senior portfolio manager, said these views during a May 22, 2026 [3] interview on CNBC’s Squawk Box. He described the pullback as a beneficial reset that corrects overvalued tech valuations and creates a healthier footing for a future rally [4, 5].
The volatility has been stark in recent trading sessions. The Nasdaq Composite fell 4.2% on a recent Friday [6], while the S&P 500 recorded its largest drop of 2026 on that same day [7]. Despite these sharp declines, Slimmon said the process is fundamentally positive for the broader market [1, 2].
"The tech selloff is healthy and good for the markets," Slimmon said during the broadcast [1]. Other analysts from Morgan Stanley said this sentiment in subsequent reports, stating that the stock plunge was a "healthy reset" that sets up a fresh rally [8].
However, the outlook is not without caution. While the reset is viewed as positive, other segments of the analysis indicate the market remains vulnerable to surprises [9]. This suggests that while the valuation correction is helpful, external shocks could still trigger instability.
Investors are currently monitoring whether this reset will lead to a diversified rally across other sectors, or if the tech sector will lead the next surge once valuations stabilize [4, 5].
“"The tech selloff is healthy and good for the markets."”
This shift in sentiment indicates that institutional investors may view the current tech volatility as a buying opportunity rather than a systemic risk. By framing the sell-off as a 'reset,' Morgan Stanley is arguing that the removal of speculative bubbles is a prerequisite for the next leg of the bull market, though the warning about 'surprises' suggests a lack of total certainty regarding macroeconomic stability.
