Goldman Sachs Warns of $80B Selloff Risk and 50% Pound Option Imbalance
Goldman Sachs warns of a potential $80B global stock market selloff, citing stretched earnings multiples and peak liquidity, and warns this could deepen losses in the crypto sector. In separate notes, it reports hedge funds boosting bearish pound bets have created a 50% call option imbalance, heightening FX risk.
1. $80B Selloff Warning
Goldman Sachs analysts caution that elevated corporate earnings multiples and peak market liquidity could spark an $80 billion global stock selloff if economic data disappoints. The warning underscores stretched equity valuations across major indices and the risk of a sharp risk-asset repricing.
2. Crypto Sector Risk
The firm highlights that a significant equity downturn may spill over into the crypto market, where valuations have surged alongside risk-on flows. Analysts note that Bitcoin and altcoins could face accelerated outflows as investors seek safer assets.
3. Pound Call Option Imbalance
In a separate research note, Goldman observes hedge funds have ramped up bearish sterling positions, resulting in a 50% skew toward call options over puts. This imbalance signals growing speculative pressure on the pound and elevated FX volatility ahead.