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18.10.2022 03:20 PM
Goldman Sachs is waiting for a new stock market turmoil

While the US stock market is gaining strength and preparing to storm for the second time in two months, bouncing off the 200-week moving average, Goldman Sachs CEO David Solomon said that the US economy might face a recession that will make it difficult to make investment and business decisions in the near future. "I think it's time to be careful, and I think if you're running a risk-based business, it's time to think about your risk appetite," Solomon said during an interview. "There is a lot of volatility on the horizon now, which means that a really difficult economic scenario is ahead of us. There is a high probability that a recession has already set in in the United States," he added.

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The statements were made after Goldman released financial results for the third quarter, which exceeded analysts' expectations for both profit and revenue. "What we are seeing now is an important moment for the company, as we are conducting another reorganization, this time combining the four main areas of our activities," said David Solomon. "The company's reorganization and business optimization reflect the evolution of the one Goldman Sachs principle."

Premarket

In the third quarter, Goldman earned $8.25 per share, beating the consensus forecast of $7.69. Revenue also exceeded Wall Street forecasts. The company's shares rose 2.3% in premarket trading.

Meanwhile, Johnson & Johnson shares rose 1.4% in premarket trading after the results beat economists' estimates for upper and lower limits, helped by rising pharmaceutical sales. J&J has narrowed its earnings forecast due to the impact of the strong US dollar.

Amazon securities gained 2.3% in the premarket after Citi named it the best choice, noting that the company will perform well under any scenario.

FuboTV shares rose 10.4% in premarket trading after the sports television company announced its sports betting business's closure and raised its sales forecast.

According to an SEC statement, Intel's Mobileye unit plans to receive about $16 billion in an initial public offering. The Wall Street Journal reported that Intel initially expected the cost of the self-driving car division to be approximately $50 billion but revised those expectations. In the premarket, the company added 1.2%.

In terms of the S&P500's technical picture, after an active growth phase yesterday, the index is already attempting to break above the resistance of $3,735. Purchases at the current highs of the index are more than adventurous. However, if they are done within the framework of a medium-term strategy, then there is nothing terrible about it. If trading is above $3,699, we expect continued demand for risky assets. This also creates good prerequisites for further strengthening the trading instrument and a breakout of $3,735.

Moreover, the bulls will expect a breakdown of this level at the beginning of the regular session. Only such a scenario will strengthen the hope for a further upward correction with an exit to the resistance of $3,773. The furthest target will be the area of $3,801. In case of a downward movement, buyers are obliged to declare themselves in the area of $3,699 and $3,661. Only a breakdown of these ranges will quickly push the trading instrument to $3,621 and open the possibility of updating support and $3,579 – a new annual minimum for the index.

Jakub Novak,
Analytical expert of InstaForex
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