Goldman Sachs’s Top Trades Reveal Uncomfortable Truth
The Wall Street bank’s calls for the year ahead implicitly acknowledge that the headwinds for the U.S. stock market are becoming much stiffer.
Goldman Sachs isn’t expecting another year of outsized gains for the S&P 500.
Photographer: Michael Nagle/Bloomberg
It’s that time when Wall Street firms start releasing their top trade ideas for the year ahead. Goldman Sachs Group Inc. was one of the first out of the box, and its suggestions reveal a lot about the supercharged environment for risky assets such as stocks that investors have enjoyed in the pandemic era without actually saying much.
Barring anything unexpected, the S&P 500 Index is poised for its third consecutive year of above average returns. Through Tuesday, the benchmark had gained about 25% for the year, building upon the 16.3% surge in 2020 and the 28.9% rally in 2019. And yet the best Goldman can muster when it looks at the equities markets is to recommend investors have exposure to Mexican and Russian shares in U.S. dollars, as well as going long Egyptian shares, according to Bloomberg News.