Goldman Sachs Executives Share 2026 Economic and Market Outlook on Odd Lots Podcast

On Dec 29, 2025, Goldman Sachs Chief Economist Jan Hatzius and Strategist Ben Snider appeared on the Odd Lots podcast to discuss the impact of AI and tariffs on the 2025 economy and their influence on 2026’s real economy and stock markets [1]. On the same day, GS stock closed at $894.64, down 1.17% with 800k trading volume, underperforming broader indices (S&P 500: -0.10%, NASDAQ: +0.08%) [0]. No direct causal link between the podcast release and GS’s underperformance was identified, as the episode’s content did not include formal report releases typical of immediate market-moving events.

GS’s 2026 outlook, as summarized in market analysis, includes: global GDP growth of 2.8%, US GDP growth of 2.6% (above consensus 2.0%) driven by reduced tariff drag, tax cuts, and easier financial conditions [0]; Fed interest rate cuts to 3-3.25% [0]; cyclical sectors (Industrials, Materials, Consumer Discretionary) expected to outperform due to stronger economic activity and easing tariff pressures, with Industrials EPS growth rising from 4% in 2025 to 15% in 2026 [0]; AI transitioning from a thematic investment to an operating model, driving tangible efficiency gains [0]; and global equities projected to deliver 13% price returns (15% with dividends), with a S&P 500 target of 7600 [0].

1. AI’s Evolution Beyond Hype
   : GS emphasizes AI is moving from a market theme to an operational driver, indicating that efficiency gains and real economic impact are becoming more tangible for adopting companies [0].
2. Cyclical Sector Tailwinds
   : Multiple factors—reduced tariffs, stronger economic activity, and easing financial conditions—align to support the forecasted outperformance of cyclical sectors, particularly Industrials [0].
3. Optimistic US Growth Outlook
   : GS’s 2.6% US GDP forecast for 2026 exceeds the 2.0% consensus, reflecting greater confidence in policy support (tax cuts, tariff easing) and economic resilience [0].

• Risks
  : If tariff tensions fail to ease as forecasted, US economic growth could be dragged down [0]; high valuations in AI stocks may lead to market corrections [0]; and less-than-expected Fed rate cuts could hinder the easing of financial conditions [0].
• Opportunities
  : Cyclical sectors (Industrials, Materials, Consumer Discretionary) are poised for strong EPS growth [0]; companies adopting AI as an operational model may realize efficiency gains [0]; and potential upside exists if GS’s S&P 500 target of 7600 is achieved [0].

GS’s 2026 outlook predicts a sturdy global economy with US outperformance, cyclical sector strength, AI’s transition to operational use, and a S&P 500 target of 7600. GS stock underperformed broader indices on the day of the podcast release, but no direct causal relationship was established. Risks include tariff uncertainties, AI valuation corrections, and Fed policy deviations, while opportunities lie in cyclical sectors and AI-driven efficiency gains.