Goldman Sachs said stock market investors who are concerned about stagflation should buy as prices fall, with expectations that the trend of accelerating inflation will not continue.
“Investor anxiety has prompted the expected drop in the S&P 500, but we believe this drop will prove to be a good buying opportunity,” US investment bank analysts said in a research note.
Goldman Sachs finds that during periods of stagflation, healthcare, health and energy stocks have generally outperformed, while more weak sectors such as industry and information technology have lagged.
Objectively speaking, stagflation was associated with changes in consumer spending behavior and the outperformance of service firms compared to firms selling goods.
Goldman Sachs analysts expected the US stock market to continue its upward trend in the coming months, with the S&P 500 rising to 4,700 points by the end of this year, which represents an increase of 7% from current levels.
The S&P 500 index closed Monday’s session down 0.7% to 4,361 points.
But Goldman Sachs expected the core inflation index in the United States to reach a peak of 4.25% by the end of this year.
The article “Goldman Sachs” calls for buying US stocks on the decline with expectations of slowing inflation was written in Al Borsa newspaper.