After an embarrassing predictive losing streak, Goldman resumed its customary winning ways on Election Day, when its millions helped put Mitch McConnell on the cover of Time magazine. And the bank has no intention of allowing its nascent winning streak to come to an end in guessing what the stock market’s going to do next year. Luckily, Team Lloyd has a plan. Two plans, actually.
Mr. Kostin, the bank’s U.S. stock-market strategist, has introduced an alternate forecast for the S&P 500 in 2015, in case interest rates remain lower than expected. If that happens, the index could rise to 2300, an 11% gain from Friday’s close, he says….
His official forecast—unveiled last month—takes into account the 3% yield on the 10-year note predicted by Goldman’s economists. Under that scenario, he expects the S&P 500 will finish next year at 2100, a meager 1.2% rise from where it closed Friday.
Goldman Unveils Backup Stock-Market Forecast If Rates Stay This Low [WSJ MoneyBeat blog]