Goldman Sachs Says Bear Market Unlikely Despite Geopolitical Tensions, AI Concerns, And High Valuations: Report

• Peter Oppenheimer of Goldman Sachs said strong earnings growth of companies in the U.S. and in emerging markets, and the potential for economic growth, are deterrents to a deeper bear market. 
• The analyst is recommending diversified investments across geographies, factors, and sectors to improve risk-adjusted returns. 
• Meanwhile, U.S. equities traded in green on Wednesday at the time of writing.

Goldman Sachs reportedly said on Wednesday that the risk of a deep bear market is unlikely despite the current geopolitical climate, disruption from artificial intelligence, and high valuations in the market.

According to a report from Reuters, the investment bank has said that it sees the “correction risks” as a buying opportunity.

"We see correction risks as high given current valuations, but expect this to present a buying opportunity with relatively low risk of a more ​protracted and deep bear market," Peter Oppenheimer, chief global ​equities strategist at Goldman Sachs, reportedly said in a note.

Bear Market Deterrent

As per Goldman’s Oppenheimer, strong earnings growth of companies in the U.S. and in emerging markets, as well as the potential for economic growth, are deterrents to a deeper bear market.

The analyst is recommending diversified investments across geographies, factors, and sectors to improve risk-adjusted returns.

Market Snapshot

Stock markets across the world, especially in the U.S., have been spooked by ballooning AI capital expenditure announcements from big tech companies since the start of the year. Capex from tech firms is expected to be nearly $700 billion in 2026.

Meanwhile, the U.S. and Israel’s war against Iran has sent prices of oil higher, stoking concerns over higher inflation and broader economic uncertainty.

The SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, has declined by 0.24% in the past month.

However, on Wednesday, the SPY ETF edged up 0.62% at the time of writing. The Invesco QQQ Trust ETF (QQQ) climbed 1.35% higher, the SPDR Dow Jones Industrial Average ETF Trust (DIA) was up 0.59%, and the tech-heavy Nasdaq-100 (NDX) also climbed 1.33%.

On Stocktwits, retail sentiment around the S&P 500 ETF was in the ‘neutral’ territory at the time of writing.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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