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Morgan Stanley Says Unloved Stocks Can Beat Global Downturn

  • Europe stocks may get QE support, economic data: strategists
  • Euro-zone companies with high domestic exposure recommended
Stock price figures sit on display inside the Frankfurt Stock Exchange.

Stock price figures sit on display inside the Frankfurt Stock Exchange.

Photographer: Alex Kraus/Bloomberg

The status of the world’s least favorite asset has its benefits. Morgan Stanley, which just slashed global equities to underweight on growth concerns, believes that European stocks can outperform weaker markets.

Although European equities have over the past 30 years tended to decline more than global markets during corrections, that relationship is changing, strategists led by Graham Secker said in a note to clients.