Tariffs are unlikely to stir another sell-off, says Morgan Stanley's Andrew Slimmon

Market Analysis & Strategy - Morgan Stanley Investment Management highlights the concept of a positive but subpar year in the third year of a bull market, influencing investment strategy [2] - The firm adopted a cautious stance early in the year after a near double-digit market increase, later adding risk in April when the market declined by double digits [3] - Current market levels are perceived as inconsistent with a typical third year of a bull market, prompting a more cautious approach [3] - The firm anticipates strong second-quarter earnings, potentially leading to a few more weeks of market strength [4] - Opportunities are viewed as less favorable compared to the spring when the market was substantially lower [4] Risk Factors & Correction - Tariffs are not expected to be the primary cause of a market correction [5] - The market is not expected to react to known factors like tariffs in the same way it did previously [6] - A potential selloff later in the summer is anticipated to be triggered by unforeseen factors [6] - Potential triggers for a correction include the Federal Reserve's decisions on interest rates, higher yields, or economic concerns [7] - The market is considered vulnerable due to the magnitude and speculative nature of the rally, particularly in euphoric stocks [7]