Nov 4 (Reuters) - Chief executives of Morgan Stanley ( MS )

and Goldman Sachs ( GS ) cautioned on Tuesday that the

global equity markets could be heading towards a correction,

underscoring a growing concern that investor optimism has

driven valuations to sky-high levels.

Fears of a market bubble come as the benchmark S&P 500

continues its meteoric climb, repeatedly hitting record

highs and evoking memories of the dot-com boom.

"We should welcome the possibility that there would be

drawdowns, 10% to 15%, that are not driven by some sort of macro

cliff effect," Morgan Stanley ( MS ) CEO Ted Pick said at the Global

Financial Leaders' Investment Summit in Hong Kong.

Markets have so far largely brushed aside concerns about

inflation, elevated interest rates, policy uncertainty from

shifting trade dynamics, and the ongoing federal government

shutdown, now in its fifth week.

"When you have these cycles, things can run for a period of

time. But there are things that will change sentiment and will

create drawdowns, or change the perspective on the growth

trajectory, and none of us are smart enough to see them until

they actually occur," Goldman CEO David Solomon said at the

summit.

Earlier this week, the co-chief investment officers of hedge

fund Bridgewater Associates had also warned that investors are

overlooking mounting risks to the current market stability and

the limits of the artificial intelligence boom, particularly in

the U.S.

(Reporting by Manya Saini and Niket Nishant in Bengaluru;

Editing by Arun Koyyur)