Goldman Says Buy World’s Worst Stock Market Because Rebound Is Coming

Goldman Says Buy World’s Worst Stock Market Because Rebound Is ComingGoldman Says Buy World’s Worst Stock Market Because Rebound Is Coming

(Bloomberg) — Goldman Sachs is bullish on the world’s hardest-hit stock market.

Down more than 48% this year when measured in dollars, Brazilian stocks will benefit from growing appetite for risky assets and a recovery in commodities prices during the second half of 2020, strategists led by Kamakshya Trivedi wrote in a report dated May 20.

“Brazilian equities are an ideal bounceback candidate,” the strategists said. They recommended investors go long the benchmark Ibovespa index with a target of 90,000 points, or about 9% above current levels.

Investors have fled from Brazilian stocks and its currency this year as the Covid-19 pandemic battered the economy and worsened the nation’s already-fragile fiscal outlook. Assets have been further undermined by political turbulence and a lack of confidence in President Jair Bolsonaro as he downplays the coronavirus threat even as Brazil becomes the world’s hotspot for new infections.

To be sure, a rally to 90,000 would still leave the Ibovespa about 22% below where it was at the end of last year.

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