Volatility is back in the market after a rather quiet summer. Goldman is 4 reasons why the stock market will move in the direction of the bear - on materials AMarkets.
The forecast from Goldman: the broader market index will close the current year at the level of 2100. Not that it is a powerful drawdown from the current value, but at least it's not growing. The forecast for the next 9 months (after the drawdown to 2100) - plus 4%. After 12 months, the S & P 500 will trade around the value in 2175 (David Kostin forecast of Goldman Sachs).
Why the market has certainly fall in the near future:
• The Goldman mood - Extreme Sentiment Indicator - is at the highest level. The value of 95 implies that the S & P 500 will fall in the near future.
• Political uncertainty is growing. Meanwhile Hillary chance to win - about 70%. The apparent advantage. But the situation is constantly changing weight. Yet Ms. Democrat represents unpopular Wall Street. All this will help to reduce expectations for performance P / E.
• Fresh statistics from production and non-production sectors of the US economy is disappointing.
• The shares are still significantly overvalued. If we compare current and historical performance P / E. If Goldman predicts the fall, the markets, and the truth may fall as investors Goldman listen and begin to sell. There is a joke in the medium traders.