Morgan Stanley: We are in a bear market

Morgan Stanley strategists stated that the fair value for the S&P 500 is around 4,000, while the intraday fluctuations and the rebound over the past week are also bear market movements.

Stating that they are in a seller position in any rally in the markets, Morgan Stanley strategists said that the returns will be negative in the tightening cycle, and they prefer defensive and financial services stocks rather than cyclical and unprofitable growth stocks.

Bank strategists, who said that the Fed's verbal guidance tool, which prepares stock markets for decisions, was abandoned, expressed that earnings revisions and the decrease in PMIs were effective in this.

Goldman Sachs strategists, on the other hand, emphasized that the year-end S&P 500 targets, which stood at 5.100, are open to downside risks, as expectations that the Fed will begin a more aggressive rate hike cycle.

The bank stated that if the prices of all remaining assets stay the same if the real interest rate of the US Treasury bond increases by 60 basis points and reaches 0 percent, the S&P 500 will decrease by 10 percent to 4,000, and if the real bond yields increase by 100 basis points, the index will decrease by 15 percent. stated that it could decrease to the level of 3,800.

While Goldman strategists stated that investors should be cautious about growth stocks, they advised investors to focus on quality stocks and increase their positions in energy stocks.