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Goldman Sachs warns stock market may not have hit bottom yet
Analysts discuss markets, big tech and renewable energy following rough week for economy
Barron’s markets editor Ben Levisohn, Barron’s reporter Carleton English and Barron’s senior writer Al Root discuss trends in markets, big tech and renewable energy after second quarter GDP signals recession.
The recent rebound in the U.S. stock market will likely prove to be short-lived, according to strategists at Goldman Sachs.
Equities bounced back in July with a solid — and rare — rally thanks to some weaker economic data that buoyed expectations of a dovish Federal Reserve and solid quarterly earnings reports from big companies that proved mostly resilient to inflation.The S&P 500, Dow Jones Industrial Average and Nasdaq Composite all notched their best month since late 2020.
But the relief rally is unlikely to last long as investors continue to weigh scorching-hot inflation, a slowdown in economic growth and a possible deceleration in U.S. hiring, according to the Goldman analysts led by Cecilia Mariotti.
"Without clear signs of a positive shift in macro momentum, temporary re-risking could actually increase risks of another leg lower in the market rather than signal the end of the bear market," they wrote in an analyst note on Thursday.
WALL STREET CONFIDENCE IN STOCK MARKETS SINKS TO LOWEST LEVEL IN 5 YEARS