After hitting new highs multiple times this year, the view that the U.S. stock market may face a "lost decade" has spread on Wall Street, warning investors to prepare for a future market cooldown.
This sentiment has been further fueled by a recent research report from Goldman Sachs, which suggests that the S&P 500 will only have a return rate of 3% over the next decade. This would be one of the worst periods for stock market performance in the past century.
However, this view has been met with opposition from various quarters. Following JPMorgan Chase, the long-term Wall Street bull Yardeni Research's strategists have also stepped forward to counter Goldman Sachs' pessimistic market forecast.
On October 22, Yardeni Research strategist Ed Yardeni stated that investors should be cautious about these market concerns, and that the coming years will be a period of market prosperity.
Yardeni: "Roaring 2030s" are expected, with a higher likelihood of the S&P 500 increasing by 11% annually.
This strategist, Yardeni, reiterated the firm's optimistic view on the "Roaring 2020s" for the U.S. stock market and refuted Goldman Sachs' bearish market prediction.
He believes that productivity gains from technological advancements will drive corporate profit margins and economic growth while controlling inflation levels. The "Roaring 2020s" for U.S. stocks may not only continue but could also extend into the "Roaring 2030s."
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In Yardeni's view, Goldman Sachs' prediction of a 3% return rate for the S&P 500 index is absurd, and even their most optimistic forecast of a 7% annual return is insufficient. He believes that, including dividend payments, there is a higher likelihood of the S&P 500 index increasing by 11% annually.Trond Grande, Deputy Chief Executive Officer of Norges Bank Investment Management (NBIM), stated, "Our initial allocation was 70% equities and 30% bonds, and we typically maintain this allocation under any market conditions. However, it is time to be a bit more cautious now."
He believes that increased uncertainty and a "completely different geopolitical situation" imply that global stock markets are currently facing an increasing number of risks.
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