TechFlow news, on February 3, according to Jinshi News, Goldman Sachs strategists said that due to the latest round of tariffs from the Trump administration affecting earnings forecasts, the U.S. stock market could decline by 5% over the coming months.
David Kostin, Goldman Sachs strategist, wrote in a report: "These announcements have surprised many investors, who expected tariffs only if trade negotiations failed. Our economists see uncertainty ahead, but believe that tariffs on Canada and Mexico are likely to be temporary."
Kostin said that if the latest tariffs persist, they would reduce his earnings forecasts for S&P 500 companies by approximately 2% to 3%, not yet accounting for further tightening of financial conditions or changes in consumer and corporate behavior. He also warned that fair value for the S&P 500 index could fall about 5% in the near term as both earnings and stock valuations take a hit.
