United States-based giant bank Morgan Stanley shared an important forecast on the first day of the week. In a statement today EuropeCommenting on the markets, the bank emphasized the declining economic activity in the region.
Analysts, addressing the slowdown in liquidity and economic growth due to higher interest rates, predict company earnings will decline. Morgan Stanley changed its outlook for sectors in its latest update.
Experts find defensive stocks more appropriate instead of cyclical sectors. Bankers raising the rating of the pharmaceutical industry, while the rating of the finance industry “neutral”updated downwards.
Morgan Stanley chief stock analyst Graham Secker emphasized that downgrades may continue in the second half of 2023. Secker believes they are only at the beginning of a period of weak economic growth.
The famous analyst stated that European-based companies are more durable than others. Graham Secker expects a limited recovery in 2024.
Morgan Stanley also made a numerical estimate of the depreciation in its announcement. The US-based bank expects a 10% decline in European stock markets.
EU-based stock indices have gained an average of 12% since the beginning of the year.
