The US bank Morgan Stanley cut its exposure to US stocks and raised it to European stocks, saying that because of the strong rally in the US stock markets it is unlikely that they will continue to perform so strongly this year.
“US stocks are performing well and are close to reaching our end-of-year price target, with weak expectations for further growth, while prospects for excellent performance of European stocks remain unaffected”, says the statement of the bank.
Morgan Stanley raise its exposure to European securities from 2% to 3% against the benchmark and reduce this to US stocks from 2% to 1%.
The main index S&P 500 expanded by more than 9% from the beginning of October 2017, while the European benchmark Stoxx 600 scored less 3% of return for the same period.
The strategists of the bank retain their preference for bond shares, with credit being the least desirable in the recent cyclical environment, which they claim to be “difficult to sell” at the end of the first quarter as PMI indices are unlikely to rise and inflation to speed up.
In their view, the best option is to increase the exposure to energy and financial companies.