Stocks still set to be ravaged by an earnings recession: Morgan Stanley

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Investors are not in a bull market and an earnings recession is still set to ravage stocks, Morgan Stanley says

Investors shouldn't believe that they're witnessing the start of a new bull market, and an earnings recession is still set to be a major obstacle to any gains this year, Morgan Stanley said in a note on Monday.

"While last week's events did not lead to an immediate reversal in this latest bear market rally, we also don't think they offered any evidence to suggest a new bull market began in October," strategists said, referring to the last week following the Federal Open Market Committee meeting. Central bankers hiked interest rates by a softer 25-basis-points on Wednesday, spurring a brief rally as investors began to price in an end to the Fed's aggressive monetary policy. , as rising interest rates weighed heavily on market in the last year.

But the headwinds haven't subsided, and rate cuts could come later than expected, the strategists warned. They note that the Fed could still keep interest rates high due to the

 

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