TLDR
- Goldman Sachs says the recent market sell-off has actually improved the setup for investors heading into April
- The S&P 500 closed at 6,528.52, up 2.91% in a relief rally, but still down 4.8% from its January 2 level
- Goldman’s asset allocation head says no recession and no runaway inflation are expected for the rest of 2026
- Q1 earnings season is now the main focus, with reports due from JPMorgan, Netflix, and others
- Goldman has named Smurfit Westrock as a Strong Buy with a $49 price target and roughly 23% upside
Goldman Sachs told investors this week that the stock market’s recent pullback may have actually created a better entry point heading into April.
The bank’s analysts say that after last week’s sell-off, investor positioning has eased and expectations have been reset. That gives the market a more balanced base to work from.
The S&P 500 closed at 6,528.52 on Monday, up 184.80 points, or 2.91%. The rally was driven by hopes for de-escalation in the Iran conflict, easing oil prices, and a rebound in tech stocks.
Despite that gain, the index is still down 4.8% from where it started the year on January 2, when it closed at 6,858.47.
Goldman’s asset allocation head, Christian Mueller-Glissmann, pointed to two key factors supporting markets: last year’s “Big Beautiful Bill” legislation and still-solid GDP growth.
“Our baseline expectation would be that markets eventually recover after a continued period of volatility,” Mueller-Glissmann said. He added that the bank’s machine-learning model puts the likelihood of a sustained 60/40 portfolio decline over the next 12 months as “reasonably low.”
Earnings Season Takes Center Stage
With positioning reset, attention now shifts to Q1 earnings. Goldman is watching for reports from JPMorgan, Bank of America, TSMC, Netflix, and UnitedHealth.
Investor expectations heading into earnings are lower than they were earlier this year. Fewer investors are expecting AI-related companies to deliver another round of outsized guidance.
Goldman says that lower bar could actually work in the market’s favor if results come in better than expected.
The bank is forecasting 12% earnings growth for the S&P 500 in 2026. That figure is now the key number markets will be tested against over the coming weeks.
This view aligns with recent comments from Morgan Stanley’s Mike Wilson, who noted that the S&P 500-to-gold ratio had moved back toward stocks, suggesting capital rotation was underway.
Goldman Picks Smurfit Westrock as a Strong Buy
One of Goldman’s current stock picks is Smurfit Westrock, a global packaging company based in Dublin. It operates more than 500 facilities across 40 countries.
Goldman analyst Gabriel Simoes rates the stock a Buy with a $49 price target. That suggests roughly 23% upside from current levels. Shares were trading at $39.85 at the time of writing.
The broader analyst community agrees. Smurfit holds a unanimous Strong Buy rating from 10 analysts, with an average price target of $58.10, implying upside of around 46%.
Simoes cited the company’s heavy US exposure — about 59% of its 2025 EBITDA — as a key advantage, noting that tariff protections could shield it from import competition.
For Q4 2025, Smurfit reported $7.58 billion in revenue, roughly flat year-over-year but ahead of forecasts by about $37 million.
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