After a tough US stock drawdown in August, Goldman Sachs economists were quick to reassure investors statement that the shares will soon rehabilitated.That is again a model of behavior of papers from 1998. However, recent forecasts GS sound much sadder - Materials AMarkets.
Economists doubt that the stock will grow at a solid pace in mind the obvious slowdown in the US economy. GS downgraded forecasts and expectations for earnings S & P 500 and the target level of stock prices. Other factors adding pessimism - drawdown in China, low oil prices. According to forecasts by David Kostin S & P 500 will close the year at the level of 2000 - is lower than the earlier forecast of 2100. Expectations on P / E was reduced to $ 109 from $ 114 forecast earlier. Other major banks - RBC Capital, Bank of America Merrill Lynch, Credit Suisse, Deutsche Bank - also lowered their forecasts in recent weeks. Another point on which ukzyvaet Kostin - high P / E multiple at a time when the FED is about to raise interest rates. According to forecasts of GS, the announcement of raising rates is expected on December 16. Historically multiples fall on expectations of recovery rates.
Past rate hikes were associated with the fall of multiples P / E: