More experts are predicting hardship for the stock market. Goldman Sachs strategists estimate there’s a 35% probability that the U.S. economy will enter into a recession within the next two years. In its investor guide to a recession, strategists say stocks could fall another 11-18%. On Wednesday, CEO David Solomon told CNBC that investors and businesses should be prepared to see a contraction in the economy as the Fed tightens conditions in a highly inflationary environment. “What I would say when I’m advising clients is we’re going to tighten economic conditions,” he said, referring to the Federal Reserve’s raising of interest rates to tame hot inflation that reached 8.3% in April. In other news, experts say while precious metals have been hit hard lately, they’re set to soon enter a bull market.
Reuters via Yahoo News/Saikat Chatterjee
Two major banks expect more pain for U.S. equities
Two major banks expect more pain for the U.S. stock markets after benchmark indexes posted on Wednesday their worst one-day losses in two years.
In a report published on Thursday, Barclays strategists said margins for U.S. companies and their forward earnings were under pressure due to a combination of factors, ranging from severity of China’s COVID lockdowns to the war in Ukraine and the U.S. Federal Reserve’s hawkish stance.
“Given the numerous negative near-term catalysts for the SPX we believe that the risks remain firmly stacked to the downside,” they said in a note, referring to the S&P 500.
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Business Insider/Amanda Cooper
Global shares get pummeled by investor fears of economic slowdown as inflation heats up
Global shares dropped on Thursday, as evidence of mounting inflation around the world fueled investor fears of a slowdown in economic growth, which hit tech stocks and cryptocurrencies.
Several major US retailers, including Target and Walmart, have warned about the impact of rising prices on the consumer. Meanwhile, the number of voices on Wall Street predicting recession is growing, with Goldman Sachs CEO David Solomon the latest to sound the alarm.
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Kitco News/Jordan Roy-Byrne
New gold bull market to begin soon
Precious Metals have been hit hard in recent weeks but what is happening in the global macro world is necessary for a real bull market to begin in Gold, gold stocks, and Silver.
Recently and historically, every big move in precious metals has transpired around either a significant correction or bear market in stocks.
Think of the major lows in precious metals in recent years: March 2020, August 2018, December 2015, and October 2008. Economic and market turmoil is always a catalyst for precious metals.
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