Goldman Sachs Eyes Upside

 Goldman Sachs Eyes Upside

Goldman Sachs Eyes 5% Upside In Stoxx Europe 600

According to Goldman Sachs, the Stoxx Europe 600 will likely touch the 510 level in the next 12 months. They had set a price target of 500 for the EU stock index.

The revised target from Goldman Sachs means the Stoxx 600 will likely gain an additional 5% upside by the end of the year 2024. This target also reveals Goldman Sachs' optimism as they expect the European economy to improve.

Improved Valuations For Eu Stocks

The valuation has improved, while the estimated P/E is around 13x. Additionally, the index trades just below the significant MA line and can be viewed as a sharp discount compared to US stocks.

The discrepancy between the prices of US and EU stocks is a sign that investors need to look at the EU markets. They added that their bullish forecast for the Stoxx Europe 600 is based on many economic indicators.

Some things that are going well for the Stoxx Europe 600 are strong PMI, order data, and interest rates, which have peaked. These are signs that the EU economy has reached a turning point.

The recent Goldman Sachs forecast suggests they are more optimistic about consumer sectors. At the same time, the leisure and travel sector stocks have also received a neutral rating from the firm.

Another sector that is expected to gain upside this year is luxury goods as the wealth situation in the USA has improved. The building and construction sector was also upgraded due to rising demand and a decline in energy costs.

However, the energy stocks received a downgrade from Goldman Sachs as they believe that power prices will decline. Overall, Goldman Sachs believes that 2024 will be suitable for the broader EU stock markets.

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