** Alternative asset manager KKR's KKR.N shares rise 1.5% to $128.82 premarket

** Morgan Stanley upgrades KKR to "overweight" from "equal-weight"; raises PT to $150 from $120, an 18% upside to stock's last close

** Brokerage says greater-than-expected tariff de-escalation with China can improve confidence in eventual capital markets recovery and re-accelerate the private markets flywheel

** Sees KKR as a way to the play the capital markets recovery as it is well-placed to benefit from tailwinds across private credit, infrastructure, private wealth, and insurance

** MS sees an attractive entry point for investors with KKR shares underperforming peers so far this year

** All 21 brokerages covering the stock rate "buy" or higher; median PT $139 - data compiled by LSEG

** As of last close, KKR stock down 14% YTD

(Reporting by Arasu Kannagi Basil in Bengaluru)

((ArasuKannagi.Basil@thomsonreuters.com;))