Morgan Stanley warns stock market rally will likely be short lived

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The stock market's relief rally has limited scope to go much further until inflation risks begin to fade, Morgan Stanley strategists say.

UBS Managing Director and Senior Portfolio Manager Jason Katz, weighs in on what he believes is behind the 'last leg of volatility.'briefly bounced back last week from a widespread selloff that began earlier this month, but equities are likely to see further losses as sky-high inflation and an increasingly hawkish Federal Reserve continue to pose risks to the economic outlook.

A sign for Wall Street is carved in the side of a building, Thursday, Nov. 5, 2020, in New York. U.S. futures and world shares have surged as investors await the outcome of the U.S. presidential election and embrace the upside of more gridlock in Was There are growing fears on Wall Street that the Fed may inadvertently trigger a recession with its war on inflation, which climbed by 8.3% in April, near a 40-year high. Other firms forecasting a downturn in the next two years include Bank of America, Fannie Mae and Deutsche Bank. Subramanian put the odds of a recession around 40%.

 

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Rally? Down more than 200 today.

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