Barclays is bullish on stocks but says soft landing narrative ‘will face reality checks’

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The team suggests that a pause in the equity markets would be logical and healthy.

“The soft landing narrative will face reality checks down the road,” analysts wrote in a note.

Given the recent market euphoria, analysts note that it’s understandable if investors are hesitant to chase the rally at current levels, opting instead to lock in some gains.

The strength and speed of the recent rally have led markets to appear short-term overbought, particularly in cyclicals.

“Equities have had an exceptional run, some consolidation would be healthy given toppish technicals,” analysts said.