Goldman Sachs' Chief Global Equity Strategist Peter Oppenheimer commented that the US stock market appears expensive, and future gains are expected to be moderate. He indicated that the likelihood of further valuation expansion is low, but profit growth is anticipated to drive market performance.
Oppenheimer expects a broader range of returns, especially among mid-cap stocks, given their higher leverage and potential to benefit more from rate declines. Additionally, these stocks are cheaper and have shown significant growth. Valuation expansions are more likely in Europe or China.
European stocks with substantial exposure to China are anticipated to benefit from China's large-scale stimulus measures. Conversely, German stocks and those focused on internal European markets are under pressure due to weakening internal demand.
This situation could persist unless there is more aggressive intervention in terms of rate cuts or growth support. Currently, UK stocks are highly attractive due to their low valuations, high free cash flow yields, and dividend yields, coupled with a stable investment environment and higher investor enthusiasm in the UK.
