BUZZ-Cap Goods: Reduce Quality, switch slowly into Cyclicals - MS
** Morgan Stanley (Xetra: 885836 - news) says investors in Capital Goods stocks should reduce expensive Quality exposure and switch slowly into lowly-valued Cyclicals
** "We expect the highest value Cap Goods stocks to derate versus distressed cyclicality," says MS
** The brokerage's core preferences are based on low growth environment and ongoing tariffs
** It adds that few companies have yet quantified the effect from tariffs, and the indirect possibility of component shortages (due to stockpiling)
** MS names Epiroc, Prysmian (EUREX: 3056144.EX - news) , Spectris , Siemens (BSE: SIEMENS.BO - news) and Weir among stocks to own for 2019
** It ups Epiroc to "overweight", seeing an attractive entry point following a near 30% price decline in Oct (Shenzhen: 000069.SZ - news) .
** MS tips to avoid in 2019 Atlas Copco (LSE: 0R82.L - news) , Electrolux, Landis+Gyr , Legrand (Paris: FR0010307819 - news) and Schindler
** It cuts Electrolux and Landis+Gyr to "underweight" on cost concerns