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Why stocks will sidestep 1920s and 1987 parallels, according to Goldman Sachs

By Mark GrundellMarketWatchJanuary 7, 2026 at 10:38 AMBullish1 min read

Goldman Sachs analysts believe the current market environment, despite some superficial similarities, will not lead to a

Goldman Sachs analysts believe the current market environment, despite some superficial similarities, will not lead to a crash comparable to 1929 or 1987. They argue that underlying economic conditions, corporate profitability, and central bank policies are fundamentally different now, providing a more stable foundation for stock performance.

Analyst sentiment: Bullish
What to watch next

Watch upcoming earnings, policy statements and sector-level price action for confirmation.

Goldman Sachs analysts believe the current market environment, despite some superficial similarities, will not lead to a crash comparable to 1929 or 1987. They argue that underlying economic conditions, corporate profitability, and central bank policies are fundamentally different now, providing a more stable foundation for stock performance.

Goldman Sachs analysts believe the current market environment, despite some superficial similarities, will not lead to a crash comparable to 1929 or 1987. They argue that underlying economic conditions, corporate profitability, and central bank policies are fundamentally different now, providing a more stable foundation for stock performance. The development arrives against a backdrop of shifting risk appetite, where investors are reassessing exposure to markets and weighing the second-order impact on adjacent sectors. Investors are watching the broader tape for follow-through. Live pricing was not available at the time of writing, but positioning data and order-book signals will shape the next session. Positioning across funds, options skew and credit spreads typically respond first; equity price action lags but tends to confirm the direction once volume returns. Readers should treat the immediate move as a sentiment proxy rather than a final verdict on fundamentals. For longer-horizon allocators the more important question is whether this changes the trajectory of cash flows, regulation or competitive dynamics. If it does, multiple compression or expansion follows; if it does not, the reaction fades within a few sessions and the prior trend reasserts itself. What to watch next: forthcoming earnings prints, central-bank guidance and any official commentary that either validates or pushes back on the market's interpretation. Reported by MarketWatch and contextualised by the Global Investing News desk under Mark Grundell.

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