Equity markets are going through a lean patch as investors shun risky bets amid the prospect of Fed tightening. An analyst at Morgan Stanley cautions that the downturn may have further legs and recommends investing in defensives.
Attention Turning to Slowing Growth
With the Fed’s pivot now well understood, investor attention now turns to growth, which is slowing and more than expected, Morgan Stanley equity strategist Michael Wilson said in a note.The current deceleration in growth is more about the “natural ebbing of the cycle” than the latest COVID variant, the analyst said. The slowdown has a bit further to go and equity markets haven’t yet priced for it, he said.
