Goldman's Kostin: Cyclicals Will Lead the Market

The video discusses the recovery of companies post-2020, highlighting the benefits of economic tailwinds and fiscal stimulus. It explores the S&P 500's dynamics, emphasizing a barbell strategy with technology as a core component. The reopening of America is expected to drive market growth, with positive earnings revisions across sectors. The relationship between interest rates and equities is analyzed, noting that current rates still favor equities. The video concludes with insights on share buybacks and the increasing popularity of SPACs.

What is the primary reason for the recovery of companies that lost money in 2020?

• Reduction in competition

• Economic tailwinds and fiscal stimulus

• Technological advancements

• Increased consumer spending

What strategy is suggested for balancing technology and cyclicals in a portfolio?

• Value strategy

• Growth strategy

• Momentum strategy

• Barbell strategy

What is the expected source of growth as the economy reopens?

• Increased government spending

• Reduction in taxes

• Reopening of America and technology

• Higher interest rates

How do higher interest rates potentially affect equity valuations?

• They make equities more attractive

• They can pose a challenge to equity valuations

• They have no effect

• They lead to higher bond prices

What is a concern when interest rates increase rapidly?

• Stronger currency

• Higher unemployment

• Increased inflation

• Headwinds to equity performance

What is the role of technology stocks in a barbell strategy?

• They are avoided

• They are only for short-term gains

• They are a core part of the portfolio

• They are considered high-risk

What trend is observed in the use of cash by companies in 2021?

• Reduction in debt

• Increased dividends

• Share buybacks

• Expansion into new markets