Goldman Says Stocks Climb Despite Hormuz, Stagflation Fears, Warns of Short-Term Pullback
Summary
- Goldman Sachs said global equities are continuing to rise despite risks surrounding the Strait of Hormuz and concerns over stagflation.
- Goldman Sachs said S&P 500 earnings per share (EPS) forecasts for 2026 and 2027 were raised sharply due to increased artificial intelligence (AI) investment and rising energy prices.
- Goldman Sachs said higher oil prices, persistent inflation and rising Treasury yields could trigger a short-term stock-market correction.
Forecast Trend Report by Period
Global equities are continuing to advance despite risks tied to the Strait of Hormuz and concerns over stagflation, Goldman Sachs said.
Walter Bloomberg, an overseas breaking-news account, reported on May 19 that Goldman said in a recent report global stocks have remained near record highs as corporate earnings improve.
Goldman said its forecasts for S&P 500 earnings per share in 2026 and 2027 were raised sharply, driven by increased investment in artificial intelligence and higher energy prices.
The gains have been concentrated in the technology, media and telecommunications sectors. Goldman also said appetite for risk assets and retail trading activity have reached extreme levels.
The bank cautioned that higher oil prices, persistent inflation and rising Treasury yields could trigger a short-term correction in equities.
