Goldman Sachs says these cyclical stocks will outperform in 2020

on Nov 19, 2019
Updated: Mar 11, 2020
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  • Goldman Sachs expects the U.S economy to recover in 2020.
  • Cyclical stocks have gained 12% in the past three months.
  • Snap-On, Urban Outfitters, CBS, TCF Financial, and Kohl’s to remain upbeat in the coming months.

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New York-based investment bank, Goldman Sachs, has recently predicted an imminent surge in the U.S economy with the start of the new year. The financial services company has also highlighted a few of the stocks that are most likely to benefit from the economic recovery that is set to begin in 2020, as per Goldman Sachs.

Cyclical Stocks Have Printed 12% Gain In The Last Three Months

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The investment bank accentuated the high return on cyclical stocks in the previous three months. The movement in such stocks is usually associated with economic growth. While S&P 500 has surged 8% in the last three months, cyclical stocks have printed 12% gain that is significantly higher than the defensive counterparts. As per the bank, the upbeat pattern in such stocks will gain further traction in the year 2020.

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The chief U.S equity strategies at Goldman, David Kostin, stated on Friday that the equity market is hinting at an imminent economic recovery in the upcoming months. He further recommended focusing on cyclical stocks for traders who wish to minimize risk and maximize reward in the next few months.

Goldman Sachs performed a thorough evaluation of the Russell 1000 index in order to highlight a few stocks that are known to practice high sensitivity towards economic affairs but are yet to climb out of the devaluation. The investment bank named 24 such stocks that can be expected to outperform the competitor cyclical stocks in the year 2020, provided that the economic growth continues to surge further.

Kohl’s And Urban Outfitters Have Noted The Highest Gain In Previous Three Months

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A few of such prominent stocks highlighted by the investment bank include Snap-On, Urban Outfitters, CBS, TCF Financial, and Kohl’s. On the basis of the last three month’s analysis, Kohl’s and Urban Outfitters have outperformed the rest of the Goldman Sach’s list. Kohl’s has printed a gain of 27% in the previous three months while Urban Outfitters has hiked by an incredible 48% in such a short period.  

The U.S FED has cut rates three times in 2019, a strategy that is directed at countering the impact of the economic slowdown. As per Goldman Sachs, the effect of FED’s strategy is likely to become evident in the next few months that will set the global financial markets for stability and strength in the year 2020. The financial services company has further commented that the U.S – China trade negotiations are likely to be concluded in this period that will further support economic growth and consequently, the upbeat stock market in the next year.

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