EM stocks may have already peaked for the year, says Morgan Stanley

After a surge to record highs in January, EM stocks may have already peaked for the year, says Morgan Stanley.

There are eight reasons why the MSCI Emerging Markets Index won’t climb any further, analysts led by Jonathan Garner, chief Asia EM strategist (based in Hong Kong), wrote in a report. The measure has overshot and fallen below the bank’s previously-set year-end target of 1,330. 

Reasons include falling copper prices, moderating balance sheets of Group-of-Four nations, peaking sentiment on reflation, tightening liquidity in China, a steadying dollar, stalling earnings revisions, “euphoric” fund inflows, and the relative performance of Korean stocks. “If we