Goldman Sachs Sees Year-End Rally Ahead Despite Stagflation Fears

Goldman Sachs is sending investors a clear signal to stop waiting for the U.S. midterm elections before investing in risk assets, particularly equities.

The Wall Street giant believes that markets have fully priced in stagflation risks and are now positioned for a year-end rally.

This optimism stems from three fundamental improvements: receding inflationary pressures, slowing but not stalling economic growth, and robust core corporate earnings.

According to Goldman's Mark Wilson, investors should not wait for the midterm elections to act, as the current market setup is favorable for a 'Goldilocks' scenario - growth that is just right, neither hot enough to stoke inflation nor cold enough to trigger recession.