Displaying items by tag: Morgan Stanley

(New York)

One thing about the wealth management landscape that has never made much sense is how JP Morgan is not early as big a player as one might expect given the overall strength of its brand. Morgan Stanley and Merrill Lynch hog all the AUM and attention, with JP Morgan and Goldman Sachs mostly on the outside looking in. Well, that may be about to change, as JP Morgan is now planning some big changes to its wealth management business. According to the WSJ “The bank is creating a unit that will combine its U.S. wealth-management operations for affluent clients and the Chase branch network’s financial-advisory business”.


FINSUM: This sounds like a plan to go after mass market wealth management like Morgan Stanley or the Thundering Herd. Could be a big play.

Published in Wealth Management
Monday, 02 December 2019 09:40

Wall Street’s Official 2020 Stock Prediction

(New York)

Analysts from across the Street have now put their predictions in for 2020, and the outlook is not as rosy as one would expect from a bunch of analysts who get paid to be bullish. The consensus outlook for equities can best be described as “meeehhh”. Morgan Stanley, UBS, and Stifel are forecasting that the S&P 500 will fall next year, while Citi, BAML, and Goldman are forecasting rises, but modest ones (single digits at the high end). Taken as an average, analysts think stocks will rise just 3% next year.


FINSUM: A published 3% forecasted rise by Wall Street research analysts feels more like they are expecting a 10% loss.

Published in Eq: Large Cap

(New York)

It is not going to be a huge crash, but Morgan Stanley thinks US stocks will struggle in 2020. The bank thinks the US is clearly “late-cycle” and that its growth will wane from 2.3% to 1.8% next year. It believes the Dollar will weaken and stocks will struggle. The bank thinks most of the benefits of the Fed’s rate cuts have already been priced into the market. “In 2020, the economy will grow more slowly as the bulk of the positive lift from lower interest rates will have been absorbed and households balance higher income with higher prices from tariff”, says Morgan Stanley. The bank says emerging markets are likely to outperform.


FINSUM: Of all the forecasts we have seen lately, this one seems the most realistic. We don’t see a big bust coming, but a plateau seems very believable.

Published in Eq: Total Market
Friday, 27 September 2019 10:24

Morgan Stanley Says No Recession Coming

(New York)

Wall Street research teams have been pretty split in their market outlooks recently. While the general mood is always bullish in equity research, an inordinate number of banks have been pessimistic lately. Do not count Morgan Stanley in that group, as they have just come out with what cannot be considered anything other than a bullish note given the current environment. The bank says there is only an 11.4% chance of a recession in the next year. Morgan Stanley also pointed out that each asset class has its own positioning right now, saying “Rates are generally pricing in a higher risk of recession than equities, giving equities greater relative downside should a recession emerge and bonds greater relative downside should economic growth begin to trough/reaccelerate”.


FINSUM: As Morgan Stanley also added in this piece, the real time to worry is if companies start cutting jobs to maintain margins. Once that happens, consumer spending and sentiment will fall rapidly.

Published in Eq: Total Market
Tuesday, 17 September 2019 12:09

BAML Says Value Stocks are Finally Back

(New York)

For some reason, there is a great deal of glee about the return of value stocks this month. Even though we are only on the 17th day of September, seemingly ever research department on Wall Street is ready to proclaim that value stocks are back. BAML fits the bill perfectly, saying that value stocks are like a tightly wound spring that is finally uncoiling. In their defense, value stocks have outperformed growth stocks by 9 percentage points this month, the biggest divergence since 2010. Morgan Stanley also notes that there is currently “a massive rotation away from growth-style factors toward value-style”.


FINSUM: It has been a great start to the autumn for value stocks, but they have been in a funk so long that it is hard to believe they have suddenly shed their shackles.

Published in Eq: Value
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