Goldman Sachs raises odds of US recession to 45%, second hike in a week
1. Goldman Sachs raises U.S. recession odds to 45%, up from 35%. 2. Escalating trade war contributes to heightened recession fears.
FAQ
Why Bearish?
Increased recession probabilities typically lead to reduced investor confidence, negatively impacting equities, including the S&P 500. Similar events have historically resulted in market downturns, particularly during the 2008 financial crisis when recession fears spooked markets.
How important is it?
The likelihood of recession influences market conditions significantly, affecting corporate earnings and investor sentiment toward the S&P 500. Heightened recession fears increase volatility in major indices.
Why Short Term?
Markets react quickly to recession indicators, often resulting in immediate downturns. For instance, during prior recession forecasts, S&P 500 has shown volatility within weeks.