Why Markets May Be Pricing in Too Many Fed Rate Hikes – Goldman Sachs Exchanges — Transcript

Why Markets May Be Pricing in Too Many Fed Rate Hikes – Goldman Sachs Exchanges — Transcript

Market views

Bullish

AIMODELS— AI infrastructure boom is resilient and unaffected by Fed rate hikes, with corporate profit margins expanding due to AI adoption accelerating the shift of GDP share from labor to corporate profits.
INFRA— Historic CapEx boom driven by AI infrastructure build is a structural tailwind that monetary policy cannot slow down, representing an unprecedented investment cycle.

Bearish

RETAIL— Companies selling to low-moderate income consumers are struggling as this demographic faces difficulty making ends meet despite wage gains, with no financial asset ownership to benefit from market gains.
XHB— Housing companies are getting squeezed by high mortgage rates affecting customers and high short-term debt costs for inventory financing, creating a double pressure on the sector.

Not investment advice.