Goldman Sachs predicts a massive influx of cash into the US stock market this year, with American households leading the charge.
Households to Remain Top Stock Buyers
Analysts at the investment bank estimate that US households will directly buy a whopping $425 billion worth of US stocks in 2024. This makes them the second-largest source of stock demand, trailing only corporations, who are projected to buy $675 billion.
“There Is No Alternative” (TINA)
Goldman attributes this continued investment to the “there is no alternative” (TINA) sentiment prevalent in the market. They specifically point to the significant role of retirement accounts in driving this trend.
April Dip and Shifting Trends
While households were initially net sellers after a market dip in early April, Goldman notes that this selling pressure has been balanced out by increased buying from institutional investors. The bank highlights the importance of household investment, stating that households directly own 38% of the US equity market, with an even larger stake when indirect ownership is considered.
Record High Equity Allocation
The report also reveals that Americans currently allocate a record-high 49% of their financial assets to equities, surpassing the previous high of 48% in 2020. This is significantly higher than other developed nations, with only 10% in the Euro area and 13% in Japan allocating their assets to stocks.
Disclaimer: This information is for general knowledge and shouldn’t be considered investment advice. Always conduct your own thorough research before making any investment decisions.
/p>