Are there still opportunities in stocks and bonds after their recent rallies? Yes, say executives at Goldman Sachs Asset Management.
"That will leave us vulnerable to potential shocks, leading investors to value having bonds in their portfolio." Another theme is companies diversifying from fossil fuels, with continued investment in alternative energy, Shah said."The rise of AI increases the capability of bad actors, requiring more defense . There will be material opportunities in defense."As for the Fed, its interest-rate hikes that began in March 2022 are"very likely" over, Shah said."But there's a high bar to start cutting. The yield curve is likely to steepen, with the biggest move in the middle.
On the consumer front, dwindling savings and high inflation are leading consumers to trade down in what they're willing to spend. Some companies can benefit from that, Shah said."Consumers are looking for experiences over goods. They are going back to normal behavior."