Catenaa, Monday, September 29, 2025- Goldman Sachs on Monday upgraded its stance on global equities to “overweight” from “neutral” over the three-month horizon, citing improving economic momentum across regions.
“We think that good earnings growth, Fed easing without a recession, and global fiscal policy easing will continue to support equities,” Goldman analysts said in a note.
The analysts held their rating at “overweight” for the next 12 months.
Global equities have surged to record highs recently, driven by optimism that the US Federal Reserve has begun cutting interest rates early enough to stave off a recession.
The MSCI World Index, which is dominated by US stocks, has climbed roughly 35% since its April lows, rebounding from a selloff sparked by recession fears following President Donald Trump’s ‘Liberation Day’ tariffs.
Resilient corporate earnings and a more dovish Fed have prompted several brokerages to raise their year-end targets for the U.S. benchmark S&P 500, with Goldman last week lifting its forecast to 6,800.
Goldman notes that equities tend to perform well during late-cycle slowdowns when recession risks remain low and policy support is strong, as seen in historical rallies during the late 1990s and mid-1960s.
However, the Wall Street brokerage downgraded its outlook on global credit to “underweight” from “neutral” for the next three months, citing late-cycle dynamics and stretched valuations as key headwinds.
Goldman also downgraded cash to “underweight” over the 12-month horizon, warning that continued Fed easing is likely to push returns on cash even lower into next year.
