Goldman Sachs says stocks near peak

Goldman Sachs says stocks near peak
Firm finds S&P 500 now trading near fair value, sees limited additional upside.
JUL 22, 2019
By  Bloomberg

The S&P 500 Index is now trading near its fair value, with limited further upside after its 19% climb so far this year, according to Goldman Sachs Group Inc. "The path forward for index ROE is likely to be challenging, although lower interest rates and lower tax rates may provide support," Goldman strategists including David Kostin wrote in a note to clients, referring to return on equity. Negative revisions to 2020 earnings-per-share forecasts and "policy uncertainty" will limit upside potential, they wrote. (More: Top 50 equity ETFs in second quarter) Benchmark American equity gauges reached record highs this month as investors bet that Federal Reserve interest-rate cuts will ensure the economy avoids a major downturn. Traders are fully pricing in a quarter-point cut at the July 30-31 Federal Open Market Committee meeting. (More: Top 50 equity mutual funds in second quarter) "The S&P 500 index trades near fair value relative to interest rates," the Goldman strategists wrote. It's also appropriate relative to profitability and historical price-to-book valuations, they added.

Latest News

Maryland bars advisor over charging excessive fees to clients
Maryland bars advisor over charging excessive fees to clients

Blue Anchor Capital Management and Pickett also purchased “highly aggressive and volatile” securities, according to the order.

Wave of SEC appointments signals regulatory shift with implications for financial advisors
Wave of SEC appointments signals regulatory shift with implications for financial advisors

Reshuffle provides strong indication of where the regulator's priorities now lie.

US insurers want to take a larger slice of the retirement market through the RIA channel
US insurers want to take a larger slice of the retirement market through the RIA channel

Goldman Sachs Asset Management report reveals sharpened focus on annuities.

Why DA Davidson's wealth vice chairman still follows his dad's investment advice
Why DA Davidson's wealth vice chairman still follows his dad's investment advice

Ahead of Father's Day, InvestmentNews speaks with Andrew Crowell.

401(k) participants seek advice, but few turn to financial advisors
401(k) participants seek advice, but few turn to financial advisors

Cerulli research finds nearly two-thirds of active retirement plan participants are unadvised, opening a potential engagement opportunity.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today’s choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave