Goldman Sachs Group Inc (NYSE:GS, ETR:GOS) forecasts that US share buybacks will surpass $1 trillion for the first time in 2025.
The Wall Street institution said this huge number is influenced by robust earnings growth from technology companies and more relaxed financial conditions anticipated from pending Federal Reserve interest rate cuts.
Goldmans predicts a 16% increase in share repurchases among S&P 500 companies, reaching $1.08 trillion in 2025, following a 13% rise to $925 billion in the current year.
"Earnings growth is the most significant driver of share repurchases at the index level," said analysts.
It added that the upcoming US election will cause some companies to hold off buybacks until 2024 is in the rearview mirror, adding to the trillion-dollar projection for the following year.