Indexed Return of Cyclicals vs. Defensives and Consensus Forward 4-Quarter U.S. GDP Growth The combination of strong earnings growth, a more favorable geopolitical environment, and supportive technical indicators has led to a significant upward revision in equity market growth expectations for 2025. Image: Goldman Sachs Global Investment Research
U.S. GDP vs. S&P 500 EPS The strong correlation between GDP growth and S&P 500 EPS underscores the importance of cautious investment strategies, particularly given current high market valuations and optimistic earnings forecasts. Image: Real Investment Advice
Tariffs Impact on YoY U.S. GDP Growth Goldman Sachs forecasts that tariffs will reduce U.S. GDP growth by approximately 0.8 percentage points over the next year, with tax cuts and regulatory easing only offsetting 0.1 to 0.2 percentage points of this decline. Image: Goldman Sachs Global Investment Research
S&P 500 Market Capitalization vs. U.S. GDP The wealth creation in the U.S. stock market has significantly outpaced the broader economy, leading to increased sensitivity of consumer spending to equity moves. Image: Bloomberg
U.S. GDP Consensus Forecast The U.S. exceptionalism narrative appears fragile. With expectations already high, there’s little room for positive surprises, and weaker economic data could hurt the dollar due to investors’ skewed positioning. Image: TS Lombard
Valuation – S&P 500’s CAPE Ratio and U.S. GDP Growth The S&P 500’s CAPE ratio is currently high relative to U.S. GDP growth, potentially indicating lower expected returns in the future. Image: Deutsche Bank
U.S. GDP Growth Goldman Sachs expresses optimism regarding the resilience of the U.S. economy, forecasting a more favorable GDP growth outlook for 2025 than current consensus estimates. Image: Goldman Sachs Global Investment Research
Contributions to U.S. GDP Growth Goldman Sachs predicts a 2.2% Q4/Q4 expansion in U.S. GDP for 2024, surpassing consensus estimates and highlighting the economy’s resilience. Image: Goldman Sachs Global Investment Research
U.S. GDP Growth BofA forecasts a robust U.S. GDP growth of 2.3% quarter-over-quarter (QoQ) seasonally adjusted annual rate (SAAR) in Q2 2024, reflecting the bank’s confidence in the resilience of the American economy. Image: BofA Global Research
U.S. GDP Growth Forecast Goldman Sachs expresses confidence in the robustness of the U.S. economy, foreseeing a positive outlook for the growth of U.S. GDP. Image: Goldman Sachs Global Investment Research
U.S. ISM Manufacturing Index and U.S. GDP Growth The large gap that currently exists between the U.S. ISM Manufacturing Index and U.S. real GDP will eventually close, as economic indicators tend to align over time. Image: Deutsche Bank Asset Allocation