The bank warned that the rally from the beginning of the year would have to lose its speed. They began their recovery after last year they reported their fastest collapse in seven decades.
The S & P500 jumped 17 percent from its bottom at Christmas, with the growth rate of the index surpassing that of the last 10 rebounds in the index after a 20 percent drop since the Second World War to the present day. If history is a teacher, Goldman warns that the index will most likely "stumble" and move away from the next three to six months.
Bank models that track economic activity and financial market performance suggest that recession worries and what the Fed's next move will be missing. In their place, we already have confidence and stability in economic growth, and the dovish position of the Central Bank leaves room only for positive surprises.
The bank's strategies say that in the short term, the return on the S & P500 will become less. They expect equity yields to be shaped by more concentrated macro indicators, and they recommend investors to focus on relative values and better opportunities by starting to pick certain shares more carefully.
According to Goldman, certain industries will offer enough good selection stocks, such as consumer-oriented, communication and healthcare sectors.
Source: Bloomberg Finance L.P.
Graphs: Used with permission of Bloomberg Finance L.P.
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