Investing.com - As the U.S. bull market in stocks ages, investment firms have been looking elsewhere in the world for leading returns.
Morgan Stanley (NYSE:MS) recently cut its exposure to U.S. equities and increased its weighting in Europe, saying the recent Wall Street rally looks unsustainable.
The shift in strategy has been underway since last year, when stocks in Europe actually outperformed those in the U,S.
The MSCI Europe Index gained 22% to the S&P 500's near 20%.
Goldman Sachs (NYSE:GS) is also among the big names that prefer Europe and Japan over the U.S.
Market watchers offer a number of reasons Europe will outperform the U.S. For one, the bull market in Europe is younger. They also cite improving economies and corporate earnings, favorable interest rates and more attractive valuations.
Bank of America Merrill Lynch (NYSE:BAC) may have the simplest reason. It expects the U.S. bull market to end in 2018 after a solid first half.