📖 Your Q2 Earnings Guide: Discover the Stocks ProPicks AI Highlights to Jump Post-EarningsRead more

Global equity bear market not over yet - Goldman Sachs

Published 11/21/2022, 04:15 AM
Updated 11/21/2022, 04:20 AM
© Reuters. A screen displays the trading information for Goldman Sachs on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 17, 2022. REUTERS/Brendan McDermid
US500
-
GS
-
STOXX
-
TOPX
-

(Reuters) - Goldman Sachs (NYSE:GS) on Monday warned that the global equity bear market is not over as the markets are yet to see a trough in the momentum of global growth deterioration, a peak in interest rates and valuations lowered to reflect a likely recession.

The Wall Street investment bank expects returns to be a "relatively low" 6% through the end of 2023 as investors focus on the pace of monetary policy tightening and the consequent hit to growth and earnings.

"We continue to think that the near-term path for equity markets is likely to be volatile and down before reaching a final trough in 2023," Goldman Sachs said in a note.

It expects the S&P 500 index to be around the 4,000-points level towards the end of 2023, implying an increase of less than 1% from current levels, as it sees no earning growth.

Goldman expects earnings for the constituents in the Pan-European STOXX 600 index to slide 8% next year, while forecasting a 3% earnings growth for companies in Japan's TOPIX and MSCI's Asia-Pacific ex-Japan indexes.

© Reuters. A screen displays the trading information for Goldman Sachs on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 17, 2022. REUTERS/Brendan McDermid

The investment bank expects investors to start to price in expectations for a bull market next year.

"We expect markets to transition into a 'Hope' phase of the next bull market at some point in 2023, but from a lower level."

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.