Median S&P 500 Performance Around Drawdowns Close to or Larger than 20% Since 1950 In the absence of recession, short-lived market drawdowns are often followed by strong recoveries, offering attractive returns to investors who stay the course rather than selling in panic. Image: Goldman Sachs Global Investment Research
Median S&P 500 Performance During 10% Corrections If there is no recession, U.S. stocks tend to do well after market corrections, often rebounding strongly and offering attractive returns to investors who stay the course. Image: Goldman Sachs Global Investment Research
Impact on U.S. YoY Real GDP Growth Goldman Sachs has cut its 2025 Q4/Q4 GDP growth forecast to 0.5% and raised its 12-month recession probability from 35% to 45%, citing tighter financial conditions, foreign consumer boycotts, and heightened policy uncertainty. Image: Goldman Sachs Global Investment Research
Average S&P 500 Returns Following 35 Corrections of 10% Since 1950 Market corrections of 10% in the S&P 500 are a normal aspect of market cycles, often presenting long-term investors with attractive buying opportunities, especially in the absence of a recession. Image: Goldman Sachs Global Investment Research
Rolling 12-Month % Change in the S&P 500 An economic slowdown or a hawkish pivot from the Fed could have a substantial impact on U.S. equities, potentially causing declines even if a recession does not occur. Image: Goldman Sachs Global Investment Research
Indexed Return of Cyclicals vs. Defensives ex. Commodities and ISM Manufacturing Index U.S. equity sector rotations are pricing in a “no landing” economic scenario, where the U.S. economy avoids both recession and significant slowdown, maintaining steady growth instead. Image: Goldman Sachs Global Investment Research
S&P 500 Market Concentration vs. 10-Year Annualized Forward Returns High concentration in the S&P 500 may boost short-term performance, but it often signals lower future returns, particularly during non-recessionary periods. Image: Goldman Sachs Global Investment Research
S&P 500 and U.S. 2s-10s Yield Curve Since the late 1950s, 10 of the last 12 yield curve steepening cycles have coincided with U.S. recessions, highlighting the yield curve’s effectiveness as a predictor of economic downturns. Image: BofA Global Research
Median Path of S&P 500 Around Un-Inversion in the 2s10s U.S. Treasury Yield Curve An un-inversion in the 2s10s U.S. Treasury yield curve can suggest a positive outlook for U.S. stocks, if a recession is avoided. Image: Goldman Sachs Global Investment Research
U.S. Credit Card Debt Balances in Serious Delinquencies Despite the rise in U.S. credit card delinquencies, the economy remains strong. Currently, there are no strong indicators that point to an impending recession. Image: BofA Global Investment Strategy
Commodities – Commodity Prices In a non-recessionary environment, lower U.S. interest rates can lead to an increase in commodity prices, particularly metals, gold, and brent crude oil. Image: Goldman Sachs Global Investment Research