Stock market’s riskiest fringes rally despite warning signals

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A top Goldman Sachs executive warned that unprecedented economic shocks are on the way. Moneyweb markets

The stock market’s speculative fringes took off Thursday in an odd risk-on session. Microsoft Corp, America’s second-largest company, cut its profit view. A top Goldman Sachs executive warned that unprecedented economic shocks are on the way. And a Federal Reserve official offered a fresh dose of hawkish commentary. But the riskiest US shares still climbed. Technology companies that have yet to make any money outperformed the blue-chip Dow Jones Industrial Average by 6.6 percentage points.

“Today’s news on the macro front provides more catalysts for risk sentiment to improve after a brutal eight weeks of selling,” said Gareth Ryan, managing director at IUR Capital. “Risk assets can only remain oversold for so long before they begin to look attractive for the opportunist.” Thursday’s advance came as private hiring data posted the smallest gain since the pandemic recovery began and Fed Vice Chair Lael Brainard threw cold water on a September pause in rate hikes.

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