Morgan Stanley reveals 11 high-conviction stocks where analysts expect an upside earnings surprise to drive share prices materially higher (ALLE, AXP, CWK, DLO, IT, GOGO, SPG, NCR, SKX, SIVB, WDC) Summary List Placement On Monday, investors held their collective breath as the Dow Jones Industrial Average witnessed its largest daily drop of 2021, plummeting more than 700 points. Fears over the spread of COVID-19''s delta variant , falling oil prices , and rising inflation hit equities hard during the trading session. On Tuesday, stocks largely recovered their losses , but some market watchers fear more downside could be on the horizon. Peter Essele, the head of investment management for Commonwealth Financial Network, told Insider that if increased cases of the delta variant lead to more lockdowns, it could be the "death knell" for the economic recovery. Essele fears investors will start to wonder if markets could be in for a case of the dreaded stagflation that the US economy witnessed in the 1970s. Morgan Stanley''s Chief US Equity Strategist Michael Wilson isn''t nearly as bearish on global economic prospects, but he still recommends clients emphasize a "defensive quality tilt" in the current market environment.