How to invest, profit from next bull market in stocks: Morgan Stanley

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There's no new bull market yet, Morgan Stanley says. Here's the smart way to stay invested safely and book bigger profits from the future bull run.

Stocks have rallied after a series of developments that seem to have shored up the banking system.

Morgan Stanley has been a consistently bearish voice in these kinds of arguments lately, and Mike Wilson, the chief investment officer and chief US equity strategist, says it's still too soon to go risk-on when it comes to stocks. Investors' interpretation of the bank bailouts and rescues has been surprisingly good for tech stocks, which has helped lift their prices almost to all-time highs. Given the size of those companies, that's been a positive jolt for US stock indexes as well.

That is, because some parts of the tech sector are heavily exposed to corporate spending patterns, they're going to struggle in a downturn and their stock performance will reflect that. Wilson says that separates tech from groups like consumers staples, utilities and large cap pharma and biotech, which hold up better in weaker economic periods.

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