Earnings growth is set to peter out — but not the bull market, says Goldman Sachs. Here’s what the firm recommends.
Earnings growth is set to nearly halve across major indices in 2027, but Goldman Sachs maintains the bull market will persist as stocks have already discounted this deceleration.
According to the investment bank, while earnings growth is almost halving across major indices in 2027, stocks have already priced in much of this deceleration. This suggests the market has adjusted to the coming slowdown in corporate profits.
Goldman's analysts recommend investors concentrate on companies that continue to deliver robust growth, as strong performance is becoming a rare commodity in the changing market environment.
The firm's stance contrasts with concerns about potential market downturns, indicating confidence in the bull market's resilience despite the expected earnings deceleration.
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