"Equity risk premia have fallen sharply and are now, mostly, back to levels seen in the run-up to the financial crisis, leaving equities more vulnerable to disappointments or shocks driven by technology competition or a worsening growth-inflation mix."
"Equity valuations are elevated not only in the U.S., which has been true for many years, but every single region around the world shows valuations above their own longer-term histories, meaning stocks are expensive everywhere and due for a fall."
"In November 2025, Oppenheimer forecasted the S&P 500 would deliver just 6.5% annual returns—the worst of any major region—while emerging markets would lead with returns of nearly 11% per year, reflecting a significant divergence in expected performance."
Peter Oppenheimer, Goldman Sachs's chief global equity strategist, has issued a warning that equity risk premia have declined sharply to levels seen before the 2008 financial crisis, indicating heightened vulnerability to market shocks. While not predicting a bear market, Oppenheimer cautions that correction risks are elevated. He notes that stock valuations are elevated not only in the U.S. but across every global region, exceeding their historical averages. Oppenheimer's track record includes a prescient 2024 call recommending international diversification, which proved successful as European and Japanese markets outperformed U.S. tech stocks. His November 2025 outlook forecasts the S&P 500 will deliver 6.5% annual returns over ten years, the weakest among major regions, while emerging markets are projected to lead with nearly 11% annual returns.
#market-correction-risk #equity-valuations #global-stock-markets #financial-crisis-parallels #investment-strategy
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