Agencies
New York
Investors have been hoping Donald Trump’s return to the White House next week will boost the US stock market, while Goldman Sachs sees stocks benefiting from the biggest expected company buybacks in at least five years.
A corporate repurchase window, when companies can buy their own stock, begins Jan 24. Goldman strategist Scott Rubner told clients in a note sent on Wednesday and seen by Reuters on Thursday that companies that make up 45 percent of the value of the entire S&P 500 could be allowed to buy back their shares.
Goldman estimates that companies could spend some $1.07 trillion on buying back their own stock this year. On the other side of the equation, global investors have poured about $143 billion into money market funds in the week ending Jan 10, the largest since March 25, 2020, Goldman said.
A large flow of cash into money markets usually coincides with market turbulence, when investors seek shelter in what they perceive to be the safest assets. Rubner says this time may be more about savvy investors keeping their powder dry before jumping back into equities.
"This is straight up cash, homie,” Rubner said, adding that "money is moving and ready to buy equities once the headlines (and prices) start to settle down.”