The extremely strong performance of U.S. stocks over the past decade is unlikely to be repeated over the next decade, said Peter Oppenheimer, chief global equity strategist at Goldman Sachs Group.
Oppenheimer said in a note that the strong stock performance partly reflects America’s leadership in technology and the market dominance of a handful of large companies.
“The U.S. stock market currently has more concentration risk than any other major market, and the stock market accounts for a much higher share of the U.S. economy than other regions,” he said. He advised investors to diversify their investments.
With only two months left in 2023, the S&P 500 index has outperformed global stocks by about 9 percentage points so far. The index is on track to outperform for the eighth time in the past 10 years.
“U.S. households own far more stocks than they do in the rest of the market,” Oppenheimer said. “Increasing competition from other asset classes such as cash and bonds may discourage further stock holdings,” he said.
He added that U.S. stock valuations are at a significant premium compared to historical levels and other markets, saying, “Investors are more interested in investing in great companies regardless of location than in regional anomalies. We need to put even more emphasis on it.”
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Original title:Goldman’s Oppenheimer Says US Stocks’ Outperformance Set to End
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2023-10-31 14:02:45
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