US stock futures (ES=F, NQ=F, YM=F) are on the move higher Monday morning as Wall Street firms, such as Goldman Sachs, turn increasingly bullish on equities.
Yahoo Finance senior reporter Allie Canal discusses the stock market and gold price (GC=F) forecasts as investors prepare for a possible government shutdown.
To watch more expert insights and analysis on the latest market action, check out more Morning Brief.
00:00 Julia
Markets are doing just fine this morning. Thank you. You know, we’re seeing this bounce back in technology in particular.
00:07 Speaker B
Right, markets doing just fine. And to your point, Julia, if history is any indication, when the government shuts down, it doesn’t have long-term impacts on stocks. Although there have been words of caution on Wall Street that we could see maybe short-term blips of volatility. But overall, things seem pretty good out there right now. We just had Goldman Sachs upgrading equities to overweight. They are bullish to the end of the of the year. Uh they’re pointing to a resilient US economy, Fed easing policy support, calling this a late cycle slowdown with a safety net. They do see the S&P 500 climbing another 2% to around 6,800 over the next few months and says that they would buy any dips along the way. But I alluded to that word of caution there. And Evercore ISI is saying that the S&P 500 is priced to perfection and could see a pull back before the end of the year. Lori Calvasina from RBC Capital Markets, she was just on a trip internationally in London and she said traders there are talking about stretch valuations, whether or not the AI bubble could burst. and that’s been more of a conversation we’ve been hearing, whether or not we are in bubble-like activity. That’s largely been shut down at this point because we have earnings that have supported these levels at least for now and that’s why the upcoming earning season is going to be so crucial for the longevity of this stock market rally. Uh still though, a lot volatility might pick up through October, through the end of the year. Because of that, you are seeing gold rally to a record high. There there’s a few different reasons for that. One is the weaker dollar. We know a weak dollar tends to raise import prices and add upward pressure on inflation at a time when we are seeing tariffs continue to work their way through the system. We will be seeing more of those tariffs rolled out later this week and that adds just yet another level of price uncertainty to the mix. And then on top of that, those shutdown risks that we’ve been discussing all morning, just fueling that greater demand for safe havens and boosting a gold’s appeal as both a hedge and a safe haven asset. Beyond just gold, there’s also different types of hedging like the Russell 2000, for example, with those expected Fed cuts along with maybe some retail names as well that I was seeing cited by analysts. But overall there is this expectation that the rally party can keep powering on here.
