According to PANews, a recent report by Goldman Sachs indicates that the current bear market in U.S. stocks may persist longer than anticipated. The market is currently experiencing an event-driven bear market, primarily triggered by tariffs. However, with the increasing risk of an economic recession, it could easily transition into a cyclical bear market.
Goldman Sachs' analysis suggests that both cyclical and event-driven bear markets typically see an average decline of around 30%, although their durations differ. Event-driven bear markets tend to be shorter and recover more quickly, lasting approximately eight months with a recovery period of about a year. In contrast, cyclical bear markets average around two years in duration and require about five years to fully rebound to their starting point.
The report also highlights that structural bear markets have the most severe impact, with an average decline of about 60%. These markets last over three years and generally take a decade to recover fully.
Catherine
