Goldman's Kostin Sees Markets Focusing on Stability

David Kostin from Goldman Sachs discusses the high valuation of the US equity market, noting its historical context and the impact of interest rates. He emphasizes the importance of stable growth and low volatility stocks in a tightening financial environment. Kostin also analyzes technology stocks, highlighting the difference between highly profitable companies and those with thin margins. He concludes by differentiating between stability and quality in stocks, suggesting that stability stocks are currently undervalued.

What is the current valuation status of the US equity market according to David Kostin?

• Consistent with historical averages

• Unchanged from last year

• Overvalued compared to historical metrics

• Undervalued compared to historical metrics

How have rising interest rates affected the valuation of long-term growth technology stocks?

• Had no impact on their valuation

• Decreased their valuation by 50%

• Increased their valuation by 50%

• Doubled their valuation

What is a key characteristic of quality stocks as defined by David Kostin?

• High share price volatility

• Low return on equity

• Unstable revenue growth

• Strong balance sheets

According to David Kostin, what is a component of quality in stocks?

• Low return on equity

• Strong EBITDA growth

• High share price volatility

• Unstable revenue growth

What is David Kostin's forecast for the S&P 500 by the end of the year?

• A dramatic increase

• A modest upside of about 5%

• No change

• A significant decline