Morgan Stanley: Investors bet too much on tax reform

Morgan Stanley CEO, James Gorman said he was worried about the excessively strong growth in the stock market in recent months, especially for technology stocks such as Facebook, Alphabet, Netflix Amazon and others.

"We have record markets and as we know, these things do not go straight"

Shares continue to rise, but major concerns among bank analysts are that investors are betting too much on the tax reform that is expected to boost companies' profits. The SP500 rose 6 percent in January only after jumping 19 percent in 2017.

"Markets are expensive, but they are not absurd yet, US revenue is on the rise, and tax cuts will do a great deal to do that," Gorman added.

"About interest rates, we at Morgan Stanley believe that this is healthy and we are not much interested in the fact that the Fed will increase them several times this year." Gorman's comments differ from those of Ray Dali, according to which the Fed "The current environment is good for stocks and negative for bonds," Dalio said in an interview with the World Economic Forum in Davos.

Source: Bloomberg Pro Terminal

Jr Trader Petar Milanov

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