Corporations and households will be net buyers of US stocks – Goldman
Corporations and households will be net buyers of US stocks – Goldman
SPY
+0.33%
Add to/Remove from Watchlist
Add to Watchlist
Add Position
Position added successfully to:
Please name your holdings portfolio
Type:
BUY
SELL
Date:
Amount:
Price
Point Value:
Leverage:
1:1
1:10
1:25
1:50
1:100
1:200
1:400
1:500
1:1000
Commission:
Create New Watchlist
Create
Create a new holdings portfolio
Add
Create
+ Add another position
Close
On Thursday, Goldman Sachs strategists updated their 2024 US equity demand projections, saying they now expect corporations and households to become net buyers of stocks.
On the other hand, pension and mutual funds, as well as foreign investors, are expected to be net sellers.
Specifically, Goldman strategists predict that in 2024, corporations will be net buyers of around $625 billion of US equities. This activity, stemming from share buybacks, cash mergers and acquisitions, and equity issuance, marks a continuation of a trend since 2000, with corporations net purchasing $5.5 trillion in equities.
“In 2023, corporations were net buyers of $565 billion in US equities, the strongest year since
2018,” strategists said.
“We expect 2024 will bring a rebound in share buybacks and cash M&A. However, we expect growth in these categories will be partially offset by a rebound in equity issuance.”
Meanwhile, Goldman forecasts that households will net buy $100 billion in US equities this year.
Households, which directly own 39% of the market, have typically shown the strongest interest in stocks during periods of robust economic growth.
“Despite elevated equity allocations, we expect that record levels of money market AUM, falling cash yields, and the strong economic outlook will drive households be net buyers of US stocks in 2024,” strategists commented.
Conversely, pension and mutual funds are anticipated to drive net selling of $325 billion and $300 billion, respectively. At the same time, Goldman projects that foreign investors will sell $50 billion in US equities in 2024.
