Use market pullbacks to buy stocks – Goldman Sachs

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Goldman Sachs strategists advised the broker’s clients against interpreting elevated bullish positioning as an inherently bearish signal.

Accordingly, such sentiment doesn’t indicate bearishness, particularly in the absence of significant macroeconomic deterioration.

Analysts see these positioning levels as presenting opportunities to capitalize on market dips after pullbacks. However, the strategists caution that a brief test of higher interest rates, particularly if swift, could result in equity weakness.

“While our economists’ baseline of resilient growth and cooling inflation can support a continuation of the ‘goldilocks’ backdrop in 2024, risks of further unwinding might persist near-term,” the strategists said.

The team also noted the importance of monitoring rate movements. Moreover, geopolitical and political risks, primarily affecting local markets, carry the potential for global implications through inflation.

Investors are encouraged to remain vigilant in assessing these factors for potential market impacts.

Source: Investing.com