Morgan Stanley on the US equity rally - says it's a "head fake"

Morgan Stanley remain unconvinced on US equity market strength. These from a Monday (US time) note to clients:

• “Bottom line, from a technical standpoint, last week’s price action showed signs of panic buying, in our view.”
• “Rather than a short squeeze , the market was driven by the biggest winners as more market participants convinced themselves the next bull market may have begun and they can’t afford to miss it.”
• “In short, we believe this rally will prove to be a head fake like last summer’s.”
• "there are many technical signals that conflict with the idea that this is the beginning of a new cyclical bull market—extreme narrowness (poor breadth), quality/defensive leadership, and broad cyclical underperformance"

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