Welcome to Thoughts on the Market.

I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity

strategist for Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives,

I'll be talking about the latest trends in the

financial marketplace it's Monday March 9th at 1130 eastern so let's get after it

almost two years ago we published a report that argued equities were likely to enter a cyclical bear market that would

take several years to complete.

This bear market would play out as a consolidation rather than a wipeout like 2008 and

nine and would affect various stocks and sectors at different times rather than all at once.

I later called it a rolling bear market and would leave both bears and bulls unsatisfied.

I always viewed last fourth quarters rally as more about liquidity. and

thought it could last fourth quarters rally as more about liquidity than fundamentals improving

and thought it could last into April or May when the Fed was scheduled to curtail

its latest balance sheet expansion program.

However, the unexpected COVID-19 outbreak

has brought that timing forward,

and the recent correction in equity markets

makes the entire fourth quarter rally last year

looked like a false breakout.

Such technical patterns are troubling because they highlight trapped capital

that came in late to the rally at bad prices.

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