It's time to turn to value stocks from sectors such as energy and healthcare given interest rates are moving higher, according to Goldman Sachs chief US equity strategist David Kostin.
"There's a much greater share of earnings that are coming from energy as compared with its market weight. Like 10% of earnings in the market and maybe 5% of market cap, so that has suggested that earnings are likely to be much higher there," he added. Stocks plunged Tuesday after stronger-than-expected economic data sparked expectations that the Federal Reserve could keep raising interest rates for longer than previously expected. The S&P 500 index of US shares had its worst day of the year so far, closing at the lowest level since January 20 – slipping below $4,000 for the first time in a month.
"The environment that we're more likely to be in, it's a more visible rate path we're anticipating and so it's going to be more of a stock picking side of it," Kostin said.
Great idea - lets let investors decide if healthcare patients should pay till point of bankruptcy, so investors can make money. Energy? Let’s invite investors to support oil so green energy is stopped. Ohhh, maybe investors could just punch folks as they walk down the street.FFS
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