Market Insights

MARKET STRATEGIST INSIGHTS 1 of 2

PORTFOLIO MANAGER INSIGHTS 2 of 2

Market Strategy

Complex markets can be difficult to decipher. We provide investment professionals and their clients with a global perspective to help explain the issues and trends affecting their portfolios.

Chart of the Week

Thinking Caps

A confluence of macro uncertainties–decelerating GDP growth, a tight labor market, and elevated inflation–may continue to invite market volatility across risk asset performance. However, from levels today, we think the risks have also become more balanced. History suggests that the US equity market tends to rally strongly in the 6-months following a bear market bottom. For US small caps, the recovery is especially pronounced in the early innings of an economic cycle.

Source: Bloomberg, FactSet, Goldman Sachs Asset Management.

Market Know-How

Catch Me If You Can

Central banks and inflation are the two main actors in a play not seen in decades. After many unexpected twists and turns, inflation has continued to be a dominant theme, fueled by tight labor markets, supply chain dynamics, and geopolitical tensions. In the US, the Fed has credibly embarked on policy tightening to rein in price pressures. Elsewhere, other major central banks also stand ready to "catch" inflation, though with different policy paths relative to the US.

2H2022 Themes

1Geopolitics: Short-Lived Shocks

2Valuations: Pricey, but Not Costly

3Rates: Over the Hump

4Inflation: Hot Inflation, Time to Cool Down

5Alpha: IDEA: Innovate, Disrupt, Enable, Adapt

GSAM Connect

July 29, 2022

Credit Check-In: Leveraged Loans Under the Microscope

In this month's Credit Check-In, we place key risks that have contributed to recent weakness in leveraged loans under our investment microscope. All told, we remain constructive on the asset class and continue to dynamically adjust our clients’ portfolios in response to loan market dynamics and the broader investment environment.

July 28, 2022

Cold War 2.0

The ongoing confrontation between Russia and the West has renewed concerns about a coming Cold War 2.0 which, compared to the broad ideological conflicts that took place in the 20th century, appears likely to do more damage to global economic growth and cooperation. We expect commodities to take a more central role in driving economic growth than in previous business cycles. We also believe the traditional investment playbook should be re-assessed to account for elevated geopolitical risks. Read more in this month’s edition of Macro and Market Observations.

July 22, 2022

Finding Market Bottom: The Cause Is The Cure

The Federal Reserve (Fed) has aggressively engineered tighter financial conditions with the express goal of reducing aggregate demand and ultimately inflation. As a result, the market has experienced higher short- and long-term interest rates, wider credit spreads, a stronger US dollar, and most notably, lower equity prices. Learn why we believe the old adage “Don’t fight the Fed” may be both the problem and the solution.

Stay posted on the latest market developments and key themes for your portfolios and practices

More Market Strategy

August 2022

Monthly Market Pulse: August

The US equity market has traded at levels suggesting significant macro weakness. While the path remains broad, two historical episodes where the S&P 500 contracted -20% in the first half of the year were followed by median forward returns of +33% in the year ahead. At today’s price, we believe risks ahead are becoming more balanced with market confidence likely to be restored once 1) inflation is past peak and 2) Fed policy trajectory shifts. While de-risking may make sense for select investors, those with time horizon and sufficient risk appetite may benefit from staying the course, especially after already realizing bear market losses.

December 2021

Supply Change

In 2022, we expect a year not of empty shelves, but of wholesale change to the composition of the macroeconomic and market drivers. In other words, the supply of key components such as monetary policy, inflation, returns, and alpha is set to transition in the new cycle.

View more perspectives on the latest market developments and trends

Asset Class Views

Access the latest views from our product teams on macro strategies and browse insights by key topics, such as equities, fixed income, money markets and alternatives.

How High to Hike

August 12, 2022

Global Fixed Income Weekly: MusinGS

In this weekly insight, we bring the global economy and fixed income markets to you. Macro at a Glance covers the latest developments in growth, inflation, and labor markets, while Policy Picture and Central Bank Snapshot details our outlook for monetary and fiscal policies. Fixed Income Navigator summarizes how our view of the world and financial markets informs and impacts our investment views.

GOLDMAN SACHS RESEARCH

Follow trends in the global economy, including policy issues and analysis of economic development from Goldman Sachs Global Investment Research.