The Financial Post reports in its Tuesday, March 31, edition that the S&P 500 correction is nearing its final stage even as the Iran war continues, according to Morgan Stanley strategists, who warn that United States Federal Reserve interest-rate hikes still pose a threat to stocks. A Bloomberg dispatch to the Post reports that there is growing evidence that the equities slide "is getting closer to its ending stages," the team led by Michael Wilson said, citing the example of previous "growth scares" that were not accompanied by a recession or rate hike. The strategists note that over half of Russell 3000 stocks are down more than 20 per cent from their 52-week highs. The S&P 500 forward price-to-earnings ratio has also dropped by more than 15 per cent, suggesting that market pricing increasingly reflects the risks posed by the Middle East war. "We think the equity market is less complacent on growth risks than consensus believes," the strategists said in a note Monday. The S&P 500 has fallen 8.4 per cent since Jan. 27. Stocks have been affected by fears over artificial intelligence and the Iran war, which has effectively closed the Strait of Hormuz and cut off a key route for global energy supplies.