The strategists of the Wall Street company Goldman Sachs Group have lowered the target for the S&P 500 index for the second time in a month, pointing to negative earnings for the year, deepening the global commodity crisis triggered by Russia’s invasion of Ukraine. US stocks.
“The biggest risks come to profits,” David Costin-led strategists wrote in a note to clients. S&P 500 Commodity inflation and consequent weak consumer demand and economic growth “, according to Bloomberg and reviewed by” Al Arabiya.net “.
They changed expectations for the key US stock index target by the end of the year from the previous 4900 points to 4700 points. Strategic analysts now expect a share return of 5% year-on-year to $ 221 in 2022, up from $ 226% in the previous estimate.
This comes after Goldman Sachs cut its first-year final target of 5,100 points for the S&P 500 last month, following a breakdown in fears of a tightening of the Federal Reserve’s policy to control rising inflation.
Meanwhile, as its invasion of Ukraine intensified price pressures, sales intensified as a wave of sanctions against Russia, one of the world’s largest producers of goods.
The latest setback is that Goldman’s revised target sees a 10% increase from current levels.
On a year-over-year basis, expectations were slightly negative for U.S. stocks, far from the rapid rally of 2021, which saw the stock reach a record high.
As economists at Wall Street see a 35% chance of a recession next year, the worst is yet to come.
In their note, Goldman strategists have stated that the risks of a recession are “somewhat pricey” at current levels. “In a rough environment, we expect low returns and valuation folds to raise the S&P 500 by 15% to 3600,” they added, urging investors to maintain high levels in the energy and health sectors to deal with the storm.
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