Goldman Sachs strategists say that the prospect of increased interest rate fluctuations will put potential pressure on US stocks. Historical data shows that in the early stages of the Federal Reserve's interest rate hike cycle, stock market performance is often weak. The research team led by Ben Snyder said that profit growth will determine the overall trend of the market in the medium to long term, but if the Federal Reserve starts raising interest rates, the stock market will be under pressure in the short term. According to team statistics, after seven rounds of interest rate hikes began in the past few decades, the average three-month return for the S&P 500 index was -2%. However, in these seven cycles, the average return of the S&P 500 index reached 9% in the 12 months after the first rate hike; with the exception of 2022, the 12-month return for each round was positive. The report points out that recent trends in individual stocks with weak balance sheets are highly tied to the Fed's interest rate expectations, and such stocks will remain highly sensitive to changes in monetary policy prospects. Specifically, high variable interest rate debt stock portfolios have recently shown a significant correlation with short-term interest rates. Goldman Sachs added that the current market has set expectations for short-term interest rate hikes. If the Federal Reserve's monetary policy shifts to dovish, it may become a favorable catalytic factor for the stock market's upward trend.

Goldman Sachs strategists say that the prospect of increased interest rate fluctuations will put potential pressure on US stocks. Historical data shows that in the early stages of the Federal Reserve's interest rate hike cycle, stock market performance is often weak. The research team led by Ben Snyder said that profit growth will determine the overall trend of the market in the medium to long term, but if the Federal Reserve starts raising interest rates, the stock market will be under pressure in the short term. According to team statistics, after seven rounds of interest rate hikes began in the past few decades, the average three-month return for the S&P 500 index was -2%. However, in these seven cycles, the average return of the S&P 500 index reached 9% in the 12 months after the first rate hike; with the exception of 2022, the 12-month return for each of the remaining 12 months was positive. The report points out that recent trends in individual stocks with weak balance sheets are highly tied to the Fed's interest rate expectations, and such stocks will remain highly sensitive to changes in monetary policy prospects. Specifically, high variable interest rate debt stock portfolios have recently shown a significant correlation with short-term interest rates. Goldman Sachs added that the current market has set expectations for short-term interest rate hikes. If the Federal Reserve's monetary policy shifts to dovish, it may become a favorable catalytic factor for the stock market's upward trend.