Accelerating momentum in AI-focused equities and the so-called “FX debasement trade” are two themes that have dominated market movements since early September, according to Goldman Sachs Group Inc (NYSE:GS, ETR:GOS) analysts.
In a note to clients on Tuesday, the firm highlighted that technology and AI-exposed stocks have materially outperformed broader indices year-to-date, while gold and other precious metals have surged as investors seek hedges against currency debasement.
Retail investors have played a particularly notable role in driving AI-stock rallies, analysts noted.
Goldman expects households to continue supporting US equity demand into 2026. However, they warned that low correlations within the S&P 500, currently at the 22nd percentile versus history, leave markets vulnerable to macro shocks, as Friday’s tariff-related selloff illustrated.
On the FX and commodities side, Goldman’s analysts highlighted gold’s exceptional performance. “Gold delivered one of its highest six-month returns over the past 40 years,” they wrote.
In response to strong inflows, Goldman’s commodities team raised its December 2026 gold price forecast to $4,900 an ounce, up from $4,300 previously.
The bank also noted gold’s historical role as a diversifier for the standard US 60/40 portfolio, noting similar patterns during the 1970s and the global financial crisis.
Goldman Sachs maintains a modestly pro-risk asset allocation for the next 12 months, with overweight positions in equities, neutral exposure to bonds, cash, and commodities, and underweight credit.
“Our US Equity Sentiment indicator continues to point to neutral investor positioning, which contrasts with sharp rallies seen in more AI-exposed and speculative areas,” they wrote, highlighting potential vulnerabilities in high-momentum segments.
“Pockets of bullish positioning within high-momentum market segments leave these spaces more vulnerable to setbacks.”
According to the analysts, investors will also be watching the start of the US third-quarter earnings season, with consensus forecasts projecting year-over-year S&P 500 earnings growth of roughly 6%. Market participants will also be gauging whether corporate results can sustain AI-driven momentum amid broader macro uncertainty.