Report published September 30, 2026

End of Month Market Intelligence: Pivot(al) – Goldman Sachs Research

Goldman Sachs · September 30, 2026

Goldman Sachs reviews September market performance and analyzes six key pivot points shaping the outlook into year-end: Fed rate trajectory, AI application adoption, energy/geopolitics, US midterms, capital competition, and Chinese stimulus. Despite a hawkish Fed and higher bond yields, the firm views equity bubble fears as overdone amid solid corporate earnings revisions.

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Finvaulta summarizes Goldman Sachs's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.

Key Takeaways

1.Markets are navigating six critical pivot points into year-end: Fed rate policy, AI proliferation from infrastructure to apps, energy price dynamics, upcoming US midterm elections, competition for capital between stocks and bonds, and Chinese policy easing.
2.While the Fed delivered a hawkish rate hike and markets priced in further tightening, Goldman Sachs forecasts only one additional hike in December as core PCE inflation trends 40bp below Fed expectations.
3.The AI trade is pivoting from infrastructure hyperscalers towards application adopters and enablers (semiconductors, security software), with Meta outperforming while Google, Microsoft, and Amazon tread water.

a lot is in flux
1) Rates & the Fed - from accommodative to restrictive
2) The AI trade - pivots from infrastructure to applications
3) Oil and geopolitical uncertainty - ready to pivot back to normal?
4) Congress - Midterm elections loom - a pivot in the making?
5) Stocks vs Bonds
6) China: policy pivot and consumption vs export pivot
chart of the month - earnings bubble?
what to watch for
this month's market performance - September 30, 2026, 12:20 PM

Report data

Exhibit 2: Earnings revisions have been unusually positive - Consensus estimates in USD. MSCI AC World EPS — as of September 30, 2026.

Metric	Estimate	Context
10-Year Treasury Yield Increase	50 bp	Rise in 10-year Treasury yields during September.
Core PCE Inflation Trend vs Fed Expectations	-40 bp	Year-over-year core PCE inflation is tracking below Fed member projections.
S&P 500 P/E Multiple Compression	3 turns	Valuation multiple contraction for the S&P 500 index year-to-date.
Implied Probability of Democratic Senate Majority	60%	Prediction market odds for Democrats winning the Senate majority (net gain of 4 seats).
Implied Probability of Democratic House Majority	90%	Prediction market odds for Democrats netting at least 3 seats to win House majority.