Market's character changing, hold cyclicals: Morgan Stanley

Ridham Desai of Morgan Stanley feels market's character is changing. Junk has beaten quality, value has outperformed growth, defensives have lagged cyclicals and small cap has topped large cap cumulatively since June 2015, he explains.

This feels like an entrenched bull market and is also behaving like one, according to him.

"We do not doubt the fundamentals of the market but we do worry about the pace of the move," he says.

As the dust settles and signals of an earnings recovery become clearer, growth styles will probably emerge as the best performing, he feels.

In the meanwhile, it may be a good strategy to hold on to stocks of cyclicals and growth companies, and keep portfolio turnover low, Desai says.