Morgan Stanley and Bank of America both warn: a few tech stocks support the market, small-cap stocks reveal the "fig leaf" of the U.S. economy

Morgan Stanley and Bank of America warned that a few tech stocks are supporting the U.S. market, while small-cap stocks reveal uncertainty about economic growth prospects. The Russell 2000 small-cap index has risen by 0.5% year-to-date, far behind the S&P 500 index. The market is increasingly focused on economic slowdown rather than inflation and interest rates. The relative performance of the Nasdaq 100 index to the Russell 2000 index, as well as the difference in the 10-year Treasury yield, indicate that the market is more concerned about the cyclicality of small-cap stocks. Morgan Stanley stated that fiscal spending and tightening interest rate policies will squeeze many companies and consumers out of the market. Investors have driven up the stocks of several companies performing well in this environment