Zhitong Finance and Economics learned that the management of 2Alexandra Wilson-Elizondo, deputy chief investment officer in charge of multi-asset solutions at Goldman Sachs Asset Management (GSAM) with $7 trillion assets, said new data showing the resilience of the U.S. labor market limits the U.S. to five consecutive weeks, further implying opportunities.
The unexpectedly strong non-farm payrolls data for November triggered a repricing of the Fed's interest rate moves, and the current swap contracts show that investors see a rate cut in March as unlikely. After the $4 trillion** that began in October, the US** is likely to weaken as markets adjust to the possibility that the Fed will keep interest rates high for longer.
Wilson-Elizondo suggests that any ** under this premise will be considered false, will move in one direction and then quickly reverse. She said in an interview: "If the market is **, this is a good opportunity to rebalance or take dips**. It's too early to say anything about the risk premium. ”
Economists at Goldman Sachs expect the Fed to start cutting interest rates in the second half of 2024 and expect U.S. economic growth to be accompanied by lower inflation, which should support the market, especially the top stocks. Wilson-Elizondo said:"We do believe in the quality factor, and in this environment, ** stocks tend to outperform, and although valuations seem to be on the tight side, we do believe there is upside. "
Wilson-Elizondo noted that despite the recent rally in small-cap stocks, GSAM is not chasing returns, as this type of ** tends to underperform later in the interest rate cycle. The company is also "cautiously constructive" on interest rates in early 2024 and expects investors to reallocate money to the long end of the curve. Wilson-Elizondo said:"We believe that a portion of the $8 trillion in money markets** will eventually move to the middle of the curve to build confidence in future cash flows. "