Morgan Stanley says get defensive because of 'late cycle' economy, buy stocks like Coca-Cola

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Trade tensions and the election will foster uncertainty in 2020, making stocks like Coke more attractive, according to Morgan Stanley.

"Trade, the election, and a late cycle economy keep the market searching for new leadership amid high uncertainty," Wilson wrote.

The investment bank sees GDP growth in the U.S. stabilizing below trend under 2% for the next year and labor costs accelerating, both of which are set to pose headwinds in the new year. In fact, Wilson wrote that central bank liquidity and positive seasonal data could boost the S&P 500 to overshoot the upper end of his 2020 bull case. But by April, he wrote, the liquidity tailwind should fade and the market will refocus on company fundamentals.

. Nearly all strategists with 2020 outlooks highlighted the importance of finding under-loved stocks with solid fundamentals opposed to the high-flying growth stocks that carried the market for much of the last decade.

 

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this late in the cycle?

Mike Wilson has been dead wrong for a very long time! Take a hike mike.

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