Goldman Sachs: Trump's tariff policy may lead to a 5% short-term decline in U.S. stocks

ChainCatcher news, according to Jinshi reports, Goldman Sachs strategists indicate that due to the latest round of tariffs from the Trump administration affecting profit forecasts, the U.S. stock market could potentially decline by 5% in the coming months.

Goldman Sachs strategist David Kostin wrote in a report: "These statements have shocked many investors, who expected tariffs to be imposed only in the event of a failure in trade negotiations. Our economists believe the outlook is uncertain, but they think the tariffs on Canada and Mexico are likely to be temporary."

Kostin stated that if the latest tariffs persist, he would lower his profit forecasts for S&P 500 constituent companies by about 2% to 3%, not accounting for the impact of further tightening financial conditions or changes in consumer and business behavior. He also warned that due to the dual impact on profits and stock valuations, the fair value of the S&P 500 index could decline by about 5% in the short term.